_edited.png)
RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
International Paper Company (XNYS:IP) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
IP
Name:
INTERNATIONAL PAPER COMPANY (XNYS:IP)
Sector:
588.00M
Industry:
Packaging & Containers
CEO:
Mr. Mark Sutton
Total Employees:
38,200
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is 1.79% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF INTERNATIONAL PAPER COMPANY(IP) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND PACKAGING & CONTAINERS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
40.93
One Month Price Target:
$41.14
Six Month Price Target :
$42.16
Likely Price in One Year's Time:
Ticker:
$43.4
Likely Trading Range Today Under (Normal Volatility)
$40.77
Price Upper limit ($) :
$41.1
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$38.98
This week:
$36.57
This month :
$32.2
Other Primary facts
Market Cap:
14.60B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
362.02M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
16.84%
-11.2%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$49.99
$45.86
$31.87
$36.00
Medium risk (<10%) entry points
Buy Call
Sell Call
$44.52
Buy Put:
Sell Put:
$43.64
$37.33
$38.22
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
IP
Sharpe Ratio:
0.02%
Comparison:
IP, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is -98.53% lower than the industry
& is -98.99% lower than the market/S&P 500 average
Average Returns/Yield of
IP
Daily returns:
0.01%
Weekly returns:
0.05%
Monthly returns:
0.19%
Yearly returns:
11.46%
Comparison of returns:
Average annual returns/yield (last 3 years) is -80.34% below industry average
Classification:
IP, is amongst the top 40% lowest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.11
Statistical test of Returns:
IP has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.33%
Weekly Volatility:
5.20%
Monthly Volatility:
10.41%
Yearly Volatility:
36.05%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.44%
Volatility in last five trading days has been -81.13% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.77%
Weekly VaR:
-10.66%
Monthly VaR:
-21.33%
How Much Can the price of
IP
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-19%
Worst case (decline):
-73.88%
This translates to price declining to:
$33.25
This translates to price declining to:
$10.69
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
IP is a 50.53% riskier investment compared to the market/S&P 500 & is 28.96% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -2.50% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
IP
Beta in relation to market/S&P 500--0.90
Expected beta in 1 year's time:
0.783
Expected beta in 3 year's time:
1.108
Unlevered (debt free) Beta:
0.525
Beta in relation to Nasdaq (XNAS):
0.662
Beta in relation to all global stocks::
0.799
Beta Comparison & Analysis
Beta of competitors/peers::
1.385
Beta is -35.14% lower than peers
Average Industry Beta:
1.004
Beta is -10.52% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
10.35%
Sustainable growth rate is -72.45% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.070
Alpha is -592.63% below industry average alpha yield
Alpha is -449% below the market average
Analysis of Cost of Capital of
IP
Equity cost of capital:
0.093
Equity cost of capital is -7.22% below industry mean WACC
Unlevered (without debt) cost of capital:
5.44%
Before-tax cost of debt:
4.68%
After-tax cost of debt:
3.70%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.70%
WACC is 13.04% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$53.14
Revenue growth rate per share of (3Y):
1.67
Annual revenue growth rate is -224.15% below industry average
EPS:
$4.53
Expected Annual growth rate of EPS (3Y):
-2.65%
Expected future EPS growth rate is -128.79% lower than the Packaging & Containers industry
Free cash flow (FCF) per share:
$4.29
Balance sheet equity growth per share: 21.37%
Equity growth rate per share is 80.11% higher than the industry
Debt per share
$21.57
EBITDA per share
$9.62
Valuation Analysis Today of
IP
P/E Ratio:
10.99
P/E Ratio of Competitors/Peers:
12.57
P/E ratio is -12.62% lower than main peers & is -44.13% lower than the industry
Stock price/value with industry average P/E ratio: $89.08
IP is -54.05% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $31.13
Present value of the expected future dividends only: $18.32
P/S (Price to Sales ratio):
0.77
Price to sales ratio is -38.19% below the industry mean
P/B (Price to book value ratio):
1.67
Price to free cash flow: 9.54
Price to free cash flow ratio is -89.54% lower than the industry
Net income growth rate (3Y):
-8.37%
Net income growth rate is -69.32% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 9.87%
Dividend yeild: 4.64%
Previous Dividend: $0.46
Previous adjusted dividend: $0.46
Previous Dividend: $1.90
Expected next dividend best case: $0.48
Expected next dividend worst case: $0.44
Average dividend payment (long-term): $0.50
Average dividend increase/decrease (growth rate) % per period: -0.97%
Expected next dividend payment date: 13/09/2022
Expected next dividend record date: 25/08/2022
Expected next dividend declaration date: 08/08/2022
Previous dividend payment date: 15/06/2022
Previous dividend record date: 27/05/2022
Previous dividend declaration date: 05/10/2022
Dividend History:
2022-05-26--$0.46
2021-11-12--$0.46
2021-05-26--$0.51
2022-02-17--$0.46
2021-08-13--$0.51
2021-02-17--$0.51
Dividend growth rate is -112.56% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
87.88%
Net debt to equity ratio:
78.50%
Debt to assets ratio:
31.04%
Net debt to assets ratio:
27.73%
Debt-to-asset ratio is -53.57% below industry average
Ability to repay debt:
Interest coverage ratio:
9.29
Interest coverage ratio is 65.32% more than industry average
Looking forward:
Debt growth rate:
-46.24%
Annual debt growth is 455% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.04%
Analysis of Key Statistics
Correlation of price movement with the market:
0.675
Statistical significance of correlation:
IP has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.556
Stock price is 21.29% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.556
Correlation of price movement with Nasdaq (^IXIC):
0.013
Covariance of price movement with the market:
0.017
Kurtosis
7.813
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.36
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
IP
Gross Profit Margin Ratio:
108%
Operating Profit Margin Ratio:
7.31%
Operating profit margin is 10.96% higher than the industry
Net Profit Margin Ratio:
108%
Effective Tax Rate:
19.13%
Effective tax rate is -47.03% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
19.84%
Return on equity (ROE) is -60.61% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
7.01%
Return on assets (ROA) is 34.78% higher than the industry
Financial Leverage:
1.5x
Current Ratio:
1.73
Current ratio is 10.24% above industry average
Cash Conversion Cycle (days):
3.7
Cash conversion cycle is -94.15% below industry average
The remaining useful life of property plant & equipment is: 6.6 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
503.6K
Each employee generates -83% less revenue than industry average revenue per employee
EBITDA generated per employee:
91.2K
Each employee generates -84% less EBITDA than industry average revenue per employee
Profit generated per employee:
46.2K
Each employee generates -83% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
15.4K
Each employee generates -193% less free cash flow than industry average revenue per employee
Assets/Capital per employee
470.5K
Each employee generates -193% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
IP
NVR, Inc. (XNYS:NVR)
WAYFAIR INC. (XNYS:W)
DARDEN RESTAURANTS, INC. (XNYS:DRI)
DOMINO'S PIZZA, INC. (XNYS:DPZ)
Restaurant Brands International Inc. (XNYS:QSR)
CARMAX, INC. (XNYS:KMX)
GENUINE PARTS COMPANY (XNYS:GPC)
CHEWY, INC. (XNYS:CHWY)
ROYAL CARIBBEAN CRUISES LTD. (XNYS:RCL)
Current Analyst Ratings
Strong buy�21%
Buy�21%
Hold�29%
Sell�4%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
19.24B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
13.82B
5.41B
-
-
2.83B
2.83B
1.18B
4.01B
69.00M
375.00M
1.16B
3.48B
1.41B
1.76B
962.00M
184.00M
1.76B
Statement of Cash Flow
Date:
Period:
261.00M
Differed Income Tax :
30.00M
Stock Based Compensation :
-
Change in Working Capital :
- 151000.00K
Accounts Receivables:
- 146000.00K
Other Working Capital:
- 36000.00K
Other Non-Cash Items:
88.00M
Net Cash Provided by Operating Activities:
588.00M
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
1.03B
291.00M
1.32B
3.85B
1.75B
262.00M
7.18B
10.71B
3.13B
-
2.89B
-
1.25B
17.97B
-
25.16B
-
197.00M
-
-
3.95B
4.14B
7.81B
1.68B
12.13B
-
16.27B
449.00M
9.22B
- 1694000.0K
-
March 31, 2022 at 6:00:00 AM
17.83B
8.89B
25.16B
3.18B
8.01B
7.0B
-
- 180000.00K
- 180000.00K
- 3000.00K
-
- 428000.00K
- 174000.00K
22.00M
- 583000.00K
- 1000.00K
- 176000.00K
1.12B
1.30B
588.00M
-
588.00M
Our Proprietary Portfolio Rating
Our Rating:
B
Price Forecast/Expected Price in Next 5 Years of
IP
2023
2024
2025
2026
2027
$53.10
$56.31
$59.70
$63.31
$67.13