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WRK Declared Quarterly Dividend after Revenue Rose in Fiscal 1Q16

Gabriel Kane

Yesterday’s Consumer Pops and Drops: PBI, ADM, WRK, and KORS

(Continued from Prior Part)

Price movement of WestRock

WestRock Company (WRK) has a market cap of $8.6 billion. WRK fell by 4.7% to close at $33.36 per share as of February 2, 2016. The price movement on weekly, monthly, and year-to-date (or YTD) basis was 4.0%, -26.9%, and -26.9%, respectively.

Technically, the stock has broken the support and is trading below all moving day averages. Currently, WRK is trading 12.0% below its 20-day moving average, 23.6% below its 50-day moving average, and 36.6% below its 200-day moving average.

The iShares Global Timber & Forestry ETF (WOOD) invests 3.1% of its holdings in WestRock. The ETF tracks the 25 largest publicly listed companies that own or manage forests and timberlands. The YTD price movement of WOOD was -10.6% as of February 1, 2016.

The competitors of WestRock (WRK) and their market caps are:

  • International Paper Company (IP) — $14.0 billion
  • Packaging Corporation of America (PKG) — $4.8 billion
  • Graphic Packaging Holding Company (GPK) — $3.7 billion

WestRock declared dividend

WestRock has declared a quarterly dividend of $0.375 per share on its common stock. The dividend will be paid on February 25, 2016, to shareholders of record as of the close of business on February 12, 2016.

Performance of WestRock in fiscal 1Q16

WestRock Company (WRK) reported fiscal 1Q16 net sales of $3,680.7 million, a rise of 46.4% compared to net sales of $2,514.2 million in fiscal 1Q15. It reported Consumer Packaging, Specialty Chemicals, and Land and Development segments sales of $1,542.2 million, $209.8 million, and $15.4 million, respectively, in fiscal 1Q16. Sales of the Corrugated Packaging Segment rose by 6.6% in fiscal 1Q16 compared to fiscal 1Q15.

The company’s net income and EPS (earnings per share) fell to -$453.5 million and -$1.76, respectively, in fiscal 1Q16, compared to $125.1 million and $0.88, respectively, in fiscal 1Q15.

Meanwhile, its cash and cash equivalents and inventories rose by 3.8% and 3.3%, respectively, in fiscal 1Q16 on a quarterly basis. Its current ratio fell to 1.8, and debt-to-equity ratio rose to 1.23x in fiscal 1Q16 compared to the current ratio and a debt-to-equity ratio of 1.9x and 1.15x, respectively, in fiscal 4Q15.

The PE (price-to-earnings) and PBV (price-to-book value) ratios of WestRock are 10.5x and 0.75x, respectively, as of February 2, 2016.

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