Containerboard makers slide after Deutsche cuts ratings

U.S. containerboard makers are retreating after Deutsche Bank analyst Mark Wilde downgraded his ratings on several stocks in the sector to Hold from Buy. The containerboard price hike investors are expecting to occur in the Fall may not materialize, the analyst wrote in a note to investors earlier today. Wilde - who noted that the stocks have rallied in recent weeks - contended that there are "real questions" about whether a price increase can be implemented and maintained. There are several signs that a successful price hike may not take place, including last week's anemic ISM manufacturing index and reports that one major containerboard maker is experiencing some downtime, according to the analyst. Wilde, who previously set the chances of a successful price hike at 60%-70%, now sees a 50% chance of such an occurrence. He downgraded the following containerboard makers to Hold from Buy: International Paper (IP), Kapstone Paper (KS), Packaging Corp. of America (PKG), and Rock-Tenn (RKT). In early trading, International Paper dropped 3.22% to $35.13, Kapstone slumped 3.86% to $20.40, Packaging Corp lost 1.89% to $32.64, and Rock-Tenn gave back 4.45% to $67.21.