Leading packaging and paper manufacturer International Paper Company (IP) recently modified its share repurchase program to enhance shareholder value. Under the new share repurchase program, the company has doubled its share authorization tally to enable repurchase of an additional $1.5 billion worth of stock over a period of time. The additional shares over its existing $1.5 billion share repurchase authorization could be repurchased through a slew of open market transactions.
During 2013, International Paper repurchased $461 million worth of shares under the share repurchase program. Over the years, International Paper has consistently returned significant cash to its shareholders through dividends and share repurchases. The company’s investment strategy takes a holistic view of the rapidly evolving market and deploys a dynamic capital allocation approach to focus on the relative value of the various sectors within the broader industry.
Moving ahead, the company plans to focus on debt reduction opportunities for improving its balance sheet and reducing effective cost of debt. International Paper’s best-in-industry talent pool and expertise are expected to offer optimal and affordable solutions, thus rendering an edge over its peers. International Paper expects to meet its capital expenditures, service existing debt and meet working capital and dividend requirements during 2014 through current cash balances, cash from operations, and existing credit facilities totaling $2.0 billion.
Headquartered in Memphis, TN, International Paper is a global paper and packaging company with operations in North America, Europe, Latin America, Russia, Asia, and North Africa. The company employs approximately 65,000 people and is strategically located in more than 24 countries serving customers worldwide.
International Paper currently holds a Zacks Rank #3 (Hold). Other better-ranked stocks in the industry include Graphic Packaging Holding Company (GPK), MeadWestvaco Corporation (MWV) and Sonoco Products Co. (SON), each carrying a Zacks Rank #2 (Buy).
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- Consumer Discretionary
- International Paper Company
- share repurchase