Stock to Avoid: PH Glatfelter - Analyst Blog

By
A A A

Zacks Investment Research downgraded PH Glatfelter Co. ( GLT ) to a Zacks Rank #5 (Strong Sell) on Apr 9, 2014. Going by the Zacks model, companies holding a Zacks Rank #5 have strong chances of underperforming the broader market.

Why the Downgrade?

PH Glatfelter's fourth-quarter 2013 results failed to impress its shareholders and as such its share price fell nearly 7.2% on Feb 13. To date, the company has not been able to regain its momentum with its share price still down by 14.5% since the earnings release.

A snapshot of PH Glatfelter's results and outlook is provided below:

Adjusted earnings per share were 34 cents, lagging the Zacks Consensus Estimate of 56 cents. However, bottom-line results surpassed the year-ago earnings of 26 cents. Revenues in the quarter increased 1.1% year over year to $435 million on the back of healthy performances in the Composite Fibers and Advanced Airlaid Materials segments. However, the Specialty Papers segment reported weak results. Cost of sales increased 11.9%, while gross margins plummeted 90 basis points.

In the last 60 days, the Zacks Consensus Estimate for PH Glatfelter has decreased 14.2% to $1.87 for 2014 and by 5.0% to $2.47 for 2015. Lowered earnings estimates as well as a negative average earnings surprise of 1.7% have made us dubious about the company's performance in the quarters ahead. Currently, the company has an Earnings ESP of -16.67% for first-quarter 2014 and -3.74% for full-year 2014.

Other Stocks to Consider

PH Glatfelter presently has a market capitalization of $1.15 billion. Other stocks to watch out for in the industry include Domtar Corporation ( UFS ), KapStone Paper and Packaging Corporation ( KS ) and Neenah Paper, Inc. ( NP ), all of which hold a Zacks Rank #1 (Strong Buy).



GLATFELTER (GLT): Free Stock Analysis Report

KAPSTONE PAPER (KS): Free Stock Analysis Report

NEENAH PAPER (NP): Free Stock Analysis Report

DOMTAR CORP (UFS): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: GLT , KS , NP , UFS

Zacks.com

Zacks.com

More from Zacks.com:

Related Videos

Stocks

Referenced

Most Active by Volume

112,007,213
  • $14.79 ▼ 2.12%
79,492,830
  • $17.05 ▲ 0.24%
63,236,947
  • $56.63 ▲ 7.54%
55,553,482
  • $3.41 ▼ 3.94%
53,662,885
  • $14.19 ▼ 3.47%
52,606,858
  • $100.75 ▲ 0.64%
39,074,810
  • $4.84 ▼ 2.22%
38,681,912
  • $25.62 ▲ 0.79%
As of 9/30/2014, 04:15 PM

Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com