SPOKANE, Wash. - Clearwater Paper Corporation (NYSE: NYSE:CLW), a prominent provider of private label tissue products, has announced a $23 million investment to introduce a new facial tissue converting line at its Shelby, North Carolina plant.
The Shelby Mill, which spans 400 acres and employs over 600 individuals, is known for producing high-quality private label bathroom tissue, paper towels, napkins, and facial tissue. The decision to expand the facility's capabilities with the latest facial tissue line is influenced by the site's strategic location close to customers, the availability of a skilled workforce, and strong local partnerships.
Michael Urlick, the senior vice president of consumer products at Clearwater Paper, commented on the selection of the Shelby location, citing the positive working relationships with local authorities and the community. He emphasized that the investment will not only cater to growing customer needs but also reinforce the company's commitment to delivering superior quality and service.
Clearwater Paper is recognized as a leading supplier of private label tissue to prominent retailers, including grocery and discount stores, as well as mass merchants. The company also manufactures paperboard for use by printers and packaging converters and provides services such as custom sheeting and cutting.
In other recent news, Clearwater Paper Corporation has been in the spotlight following strong first-quarter financial results for 2024. The company reported an adjusted EBITDA of $61.5 million, surpassing RBC (TSX:RY) Capital Markets' estimate of $57.5 million. This performance prompted RBC Capital Markets to raise their price target for Clearwater Paper from $41 to $42, while maintaining a sector perform rating.
The company also reported net sales of $496 million, largely due to substantial contributions from its tissue business. Despite challenges like a severe weather event impacting operations, Clearwater Paper managed to reduce its net debt by $33 million and repurchased $1 million in stock.
InvestingPro Insights
As Clearwater Paper Corporation (NYSE: CLW) gears up for expansion with its $23 million investment in the Shelby plant, the company's financial health and market performance are pivotal factors for investors to consider. Clearwater Paper has been making significant strides in the market, as evidenced by several key metrics and InvestingPro Tips.
One notable InvestingPro Tip is that management has been actively engaging in share buybacks, which often signals confidence in the company's future and can lead to an increase in shareholder value. Additionally, Clearwater Paper boasts a high shareholder yield, further emphasizing its commitment to delivering returns to its investors.
Looking at real-time data, Clearwater Paper's market capitalization stands at a robust $831.09 million. The company presents an attractive valuation with a price-to-earnings (P/E) ratio of 8.34, which dips even lower to 7.53 when adjusted for the last twelve months as of Q1 2024. Moreover, the P/E growth (PEG) ratio of 0.09 suggests that the stock could be undervalued relative to its earnings growth potential.
Investors may also find the company's performance in the stock market reassuring, with a strong return of 65.64% over the last year and a significant 41.2% year-to-date price total return. Additionally, the stock is trading near its 52-week high, at 92.72% of the peak price, indicating a positive trend in investor sentiment.
For those seeking more comprehensive analysis and additional InvestingPro Tips, such as the company's profitability predictions for this year and insights into its free cash flow yield, visit https://www.investing.com/pro/CLW. Clearwater Paper has 10 more InvestingPro Tips available, which can be accessed with an additional 10% off a yearly or biyearly Pro and Pro+ subscription using the coupon code PRONEWS24.
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