Domtar (UFS) Downgraded to “Sector Perform” at Royal Bank of Canada

Domtar (NYSE:UFS) (TSE:UFS) was downgraded by equities researchers at Royal Bank of Canada from an “outperform” rating to a “sector perform” rating in a research note issued on Wednesday. They currently have a $55.00 target price on the basic materials company’s stock. Royal Bank of Canada’s target price suggests a potential upside of 10.60% from the company’s previous close.

Other equities research analysts have also recently issued reports about the stock. TheStreet cut shares of Domtar from a “b” rating to a “c+” rating in a research report on Wednesday, October 24th. ValuEngine raised shares of Domtar from a “strong sell” rating to a “sell” rating in a research report on Thursday, January 10th. Citigroup cut their price objective on shares of Domtar from $52.00 to $38.00 and set a “neutral” rating on the stock in a research report on Monday, January 7th. Raymond James set a $49.00 price target on shares of Domtar and gave the stock a “hold” rating in a research report on Thursday, November 1st. Finally, National Bank Financial reissued a “sector perform” rating and set a $48.00 price target on shares of Domtar in a research report on Monday, December 10th. Two analysts have rated the stock with a sell rating, eleven have assigned a hold rating and two have assigned a buy rating to the stock. Domtar presently has an average rating of “Hold” and a consensus target price of $48.23.

UFS traded down $0.36 during trading on Wednesday, hitting $49.73. The company had a trading volume of 6,328 shares, compared to its average volume of 910,589. The stock has a market capitalization of $2.93 billion, a P/E ratio of 19.12, a P/E/G ratio of 1.83 and a beta of 1.98. Domtar has a one year low of $33.81 and a one year high of $54.50. The company has a current ratio of 2.37, a quick ratio of 1.34 and a debt-to-equity ratio of 0.43.

Domtar (NYSE:UFS) (TSE:UFS) last posted its quarterly earnings data on Tuesday, February 5th. The basic materials company reported $1.63 EPS for the quarter, beating the consensus estimate of $1.62 by $0.01. The business had revenue of $1.39 billion for the quarter, compared to analysts’ expectations of $1.44 billion. Domtar had a negative net margin of 2.67% and a positive return on equity of 9.13%. The firm’s revenue was up 4.1% compared to the same quarter last year. During the same period in the previous year, the firm posted $0.64 EPS. On average, equities research analysts predict that Domtar will post 4.61 EPS for the current fiscal year.

A number of large investors have recently modified their holdings of the business. Winslow Evans & Crocker Inc. bought a new stake in shares of Domtar in the 4th quarter valued at about $26,000. IFP Advisors Inc raised its holdings in shares of Domtar by 144.8% in the 4th quarter. IFP Advisors Inc now owns 2,269 shares of the basic materials company’s stock valued at $79,000 after purchasing an additional 1,342 shares during the period. Meeder Asset Management Inc. raised its holdings in shares of Domtar by 138.5% in the 4th quarter. Meeder Asset Management Inc. now owns 2,459 shares of the basic materials company’s stock valued at $121,000 after purchasing an additional 1,428 shares during the period. First Hawaiian Bank bought a new stake in shares of Domtar in the 3rd quarter valued at about $130,000. Finally, Zurcher Kantonalbank Zurich Cantonalbank raised its holdings in shares of Domtar by 14.0% in the 2nd quarter. Zurcher Kantonalbank Zurich Cantonalbank now owns 2,610 shares of the basic materials company’s stock valued at $100,000 after purchasing an additional 320 shares during the period. 89.23% of the stock is currently owned by hedge funds and other institutional investors.

About Domtar

Domtar Corporation designs, manufactures, markets, and distributes various communication papers, specialty and packaging papers, and absorbent hygiene products in the United States, Canada, Europe, Asia, and internationally. It operates in two segments, Pulp and Paper, and Personal Care. The company offers business papers, including copy and electronic imaging papers for use with inkjet and laser printers, photocopiers, and plain-paper fax machines, as well as computer papers, preprinted forms, and digital papers for office and home use.

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