International Paper Co (IP)

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International Paper drops after 4Q loss
International Paper stock down after 4Q loss, analyst's lower price target, earnings estimate
Friday January 30, 2009, 7:15 pm EST
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NEW YEAR (AP) -- International Paper Co. stock tumbled Friday after the largest U.S. paper and forest products company lost money in the fourth quarter because the recession forced it to shut mills struggling with tepid demand.

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Symbol Price Change
IP 7.29 +0.10


News of the $452 million loss led one analyst to cut his share price target to $11 from $16. Deutsche Bank-North America analyst Mark Wilde maintained his "Hold" rating but trimmed his earnings per share estimate for this year to nil from 50 cents.

Analysts polled by Thomson Reuters expect, on average, 85 cents.

"With a weak economy, declining demand, and a strengthening U.S. dollar, we think that earnings will remain cyclically depressed in the near-term," he said in a client note.

"The greatest downside risk facing IP is global economic risk. Other downside risks include spikes in input costs such as energy, fiber, freight, and chemicals."

The stock fell $1.40, or 13.3 percent, to close at $9.12. The stock has declined by 73 percent from a 52-week high of $33.77 last February.