Paper companies are a vital part of an essential market that continues to grow.
Looking to get in on some of the action? We’ve listed five of the best paper products stocks below to pick up right now.
Best Paper Products Stocks To Watch
Kimberly Clark Corp (NYSE: KMB)
Kimberly Clark is one of the world’s leading paper product manufacturers. The company has over 150 years in business and is headquartered in Texas.
It was founded on the principle of making people’s lives better. To this day, Kimberly Clark’s code of conduct remains vital to its business strategy.
Kimberly Clark’s consumer products include tissue paper, diapers, and items for feminine hygiene. It also has brands for scientific use and filtration apparel.
Some of the company’s best-known brands are Andrex, Cottonelle, Depend, Kleenex, and Scott. These consumer goods see use in more than 175 countries around the world.
Over one-quarter of the world’s population uses a Kimberly-Clark item every day. In most areas, Kimberly-Clark products hold the top spots for brand share.
Last year alone, Kimberly Clark brought in more than $19.4 billion in sales. Many of the company’s consumer products are essential goods, so demand remains high regardless of market conditions.
Share prices reflect this trend nicely. The paper stock has grown more than 2,900% since its IPO back in the 1980s.
Growth has slowed some since the pandemic, but Kimberly Clark still looks to be a solid long-term investment.
It also pays out a healthy 3.74% dividend yield to investors looking for passive income.
International Paper Co (NYSE: IP)
International Paper is one of the world’s largest producers of fiber-based engineered materials. The company creates both packaging solutions and pulp for personal care.
Founded in 1898, International Paper has a long history in the business. It started as the merger of 17 pulp and paper mills and remains a leader in the sector.
The company’s global cellulose fibers segment makes fluff pulp for use in diapers, tissue, etc.
Corrugated packaging products and containerboard supplies produced by International Paper span the globe.
IP also plays a significant role in the commercial recycling of old market pulp. The team strives to be among the most sustainable companies on the planet.
A recent spinoff of the new company Sylvamo divorced International Paper from its uncoated papers business. International Paper now focuses solely on its pulp and paperboard segments.
Most of IP’s sales come from the North American market, with packaging production leading the charge. With an ever-present demand for packaging, International Paper continues to look for new market share.
Share prices have experienced a bit of a roller coaster over the last few years. The stock remains down from where it was last year at this time.
IP’s paper supplies are popular with consumers, lending to the likelihood of growth in the future.
The company’s financials remain strong, and a 5.06% dividend yield is available to shareholders.
Mercer International Inc (NASDAQ: MERC)
Mercer International is one of the world’s largest producers of market pulp.
The company’s modern mills make softwood and hardwood pulp for use in other areas.
These pulp products become paper, packaging, and sanitary goods at other companies. Mercer is working to meet the demand as the need for such items increases.
In addition to its pulp segment, Mercer is also becoming a significant player in solid wood products. Its entire timber supply comes from sustainably managed forests.
The company also creates bio extractives and biomaterials from wood alongside biofuel for pellet stoves.
If that wasn’t enough, it also produces electrical and thermal energy from its pulping process.
Started in 1968, Mercer now has 12 facilities across three continents. Its headquarters sits just outside Vancouver, Canada.
MERC continues to expand operations, acquiring a timber-producing German company in 2022. The purchase made Mercer the largest pallet producer in the country.
Another long-term stock pick to watch, Mercer is up 80% overall. No stranger to volatility, the paper company may be of interest to short traders as well.
Still, revenue numbers from 2022 surpassed expectations, showing a positive outlook for 2023. MERC maintains a 2.80% dividend yield despite shaky share numbers.
Suzano SA (NYSE: SUZ)
Suzano believes in planting the future and creating renewable solutions. Through this principle, the company creates everyday products with sustainability in mind.
With over 90 years under its belt, Suzano has long been a pioneer in the paper industry. Many of its facilities are vertically integrated to minimize their environmental impact.
Located in Brazil, Suzano is the largest of its kind in Latin and South America. It produces fluff pulp and paper for more than 80 countries in the region and beyond.
In addition to making pulp, the company operates several paper brands.
These brands cover everything from specialty papers to supplies for home use.
Suzano’s efforts result in consistent double-digit revenue increases from one year to the next. Share prices, for the most part, agree, although values have stagnated over the past year.
There’s plenty of momentum to propel these prices upward. Analysts feel the current valuation is on the low side. Jumping in now could lead to nice gains as the stock finds its place.
Clearwater Paper Corporation (NYSE: CLW)
The Clearwater Paper Corporation dates back to 1926 as a subsidiary of the Clearwater Timber Company.
Financial troubles during the Great Depression led to the company’s absorption into a larger enterprise.
For nearly 70 years, Clearwater operated as part of Potlatch Forests. It finally re-emerged as part of a 2008 spin-off with headquarters in Spokane, Washington.
Today, the company specializes in private-label tissue production through a unique line of products.
Mills and distribution centers across the continent move supplies quickly.
The business also dips into high-quality paperboard used in food service and packaging. Clearwater stands as North America’s largest independent manufacturing company of the stuff.
Clearwater Paper Corporation appeared back on the New York Stock Exchange in late 2008.
Shares have increased more than 240% over the last 14 years, and the company appears primed for more.
It’s worked hard to eliminate debt and cut dead weight over the last five years. These changes have led to a positive financial outlook for this year and beyond.
Despite long-term gains, the last six months have been quiet on the stock front. Its behind-the-scenes magic could lead to a strong 2023.
Are Paper Products Stocks a Good Investment?
Paper stocks can be a great investment with a bit of foresight. The paper industry has always been an essential part of the basic materials sector, and this trend shows no sign of slowing.
Even in poor economic conditions, people need paper products for daily life. I can’t imagine a day anytime soon when toilet paper won’t be the norm.
Although printing papers for newsprint and writing is down, demand for a wide array of paper products is still high.
The recent e-commerce boom has kicked corrugated packaging production to a new level.
Many of these paper companies recycle old products into pulp that lives again in diapers or other hygienic items. Paper past the point of no return dissolves quickly and returns to the earth.
Countries tend to look favorably on sustainable businesses that don’t pollute the planet.
In many areas, the only options besides paper are plastics that take millennia to decompose.
Paper stocks have strong long-term potential as global demand keeps moving up. Many pulp and paperboard manufacturers have solid enough financials to pay out regular dividends to investors.
We’re excited about what each of the paper stocks on this list is doing, but don’t just take us at our word. Be sure to do your own research before jumping into any trades.
Frequently Asked Questions (FAQs)
What Is The Most Successful Paper Company?
International Paper reigns king for both production quantity and overall paper sales.
Who Is The Largest Producer of Paper Pulp?
The United States wins as the world’s largest producer of pulp. Many of the best paper stocks fall within her borders. Brazil is a distant second, generating roughly half the amount.
Who Imports The Most Paper?
China imports more paper than any other country as of early 2023. Time will tell if this trend continues as relations between China and the United States are stretched.
Are Paper Companies in Decline?
Traditional graphic paper as we know it is disappearing. More people switch to online publications every year. However, paper companies remain strong through other avenues, such as absorbent hygiene products and consumer packaging.
Will Paper Disappear in The Future?
Despite being in a digital world, there’s no indication that paper will disappear in the future. Many folks still enjoy the feel of paper in the form of books or other prints. Paper is still a safe bet for the foreseeable future.
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