KP Tissue Inc

KPT-T

This company produces paper towels and other paper products. The rising cost for pulp has hurt their bottom line. China is buying more pure pulp fibre and this is hurting their business. Yield 7.4%. (Analysts’ price target is $11.00)

Consumer staples. He was taking a look at it when it pulled back He stayed away because the chart is telling him there is no clarity on share price given that input costs are on the rise. It is too early to buy.

It is a slow steady eddie company. It is okay and there is nothing wrong with it but it does not get him excited. It is probably not going to hurt your portfolio nor help it much.

The tissue space in general is struggling with pricing, probably as a result of over pricing in North America. Having a pure play in this area is not something you would want to do. Expects it will be challenged for the next couple of quarters. Prefers Cascades (CAS-T), which has an offset with container board/cardboard packaging.

As a hold for the next 5 years?On a total return basis, this is not as terrible as the stock price suggests. It has underperformed. There has always been something that pops up to hurt them over the past few years. It looks like pulp prices continue to go higher, so he doesn’t expect the best quarter in Q3. However, they have pricing power because their branded tissue toilet paper has been able to pass those price increases on to customers. He likes this for the 4.7% dividend. They have ambitious growth plans.

There are some certainties in life, and one of them is toilet paper. They are going to commission a new machine at their plant in Memphis Tennessee, which will increase output. It’s a competitive business. They do private label branding for the big box stores. Thinks earnings will come up and distribution will come up. Dividend yield of 4.8%.

Trading like it is a private label company, which is not the case, because they have significant branded products they sell in Canada. The previous quarter they had was pretty good, and have announced that they are raising prices. They are looking to add another private label machine and has also started another private label machine in Québec, which should improve margins. The knock against the company is that it is always next year’s story. 5% dividend yield.

The largest branded tissue manufacturer in Canada. Also, sells private label in the US. Trying to increase its private label exposure in the US and hopes to launch another tissue plant. These are all going to take time, money and effort. In the meantime, the stock has done absolutely nothing. On the flipside, you have a terrific dividend of almost 5%. They are investing for the future, which is not a bad thing. You are going to have to be patient. It is cheap on a valuation standpoint, but does have more debt than he would like.

He has been continuing to buy this for new and existing customers. He has now reached the limit of his weighting. Only 15% of the company’s stock has been sold to shareholders. This is a well run product with very strong pricing power and a nice dividend. They are working through a lot of projects including one to get more sales to offices.

Produces personal paper products. A consumers staples name, so a bit on the premium valuation side, but deservedly so, because in a recessionary environment, people look at these types of stocks. Dividend yield of about 5%. He probably wouldn’t own this for anything other than the dividend. Growth is pretty slow.

This has branded tissue and toilet paper in Canada, and manufacture a private label in the US. A wonderful business. Last quarter was very good. They’ve finally been benefiting from raising prices, and pulp prices have held tight.

Finally having a good year. It has been doing fine over time. Things that were headwinds for them are finally going to become tailwinds. The Cdn$ seems to have stabilized. They’ve been able to raise prices on their branded tissue and toilet paper. They are the #1 brand for toilet and tissue paper in Canada. Also sells private label tissue paper into the US through Walmart. The good news is that their private label manufacturing facility is sold out. They are planning to build a new facility, and if they do, they may have to do an equity and debt raise. If that goes through, it may increase the float and make the stock more attractive for institutional investors. Thinks it is worth $20 today and $22 if they get the go-ahead on the new facility.

Tissue products. A slow and steady type of name. Pays about a 5% dividend yield. This is probably just going to grow with GDP over the long-term, kind of a steady Eddie. OK, but not his favourite.

This has underperformed. The biggest branded tissue and toilet paper in Canada. It got hurt by the rise in the US$, which hurt earnings, as well as the rise in commodity prices. Those things have turned around, and the company had a monster of a quarter, but the stock didn’t react as well today as he would have thought. He thinks FV is $16 a share. Pays a fantastic dividend. Smart management which is working on growing the business. Dividend yield of 5%+.

He likes this company. It is a stable business. In a market where you are worried about stock valuation or not too comfortable with volatility, this is a decent name. He would own this more for the 5.3% dividend.

(Market Call Minute.) Everybody likes their products. The problem is that the Krueger family doesn’t treat it like a public company, but treats it like it is still a private company. He likes to be where shareholders are treated better than that.

(Market Call Minute) He likes the products but the family owns lots of other non-public companies and sometimes forget this one is public. He stays away.

When he bought his holdings, it was a much more competitive industry than what he had expected. The company had problems in getting their plant in Memphis Tennessee up and running and being as efficient as he had expected. This is now in that “show me” category. It is a good yield stock even if it doesn’t grow that much. He feels it is undervalued.

The net trend in the last 6 months has clearly been down. He would want to see a break through the trend line at about $11.50 on some volume. At this point, you don’t buy a falling knife.

Has a big holding in this. One reason the stock is down is that they buy a lot of pulp in US$s, which has impacted margins. The company continues to maintain the leading brands of tissue and toilet paper. Absurdly cheap in his opinion. Hopes management initiates a share buyback or something. Feels the dividend is more than fully protected and expects a better year in 2016. It could easily recover to the $14-$15 range. Hopefully, once the US$ starts to tail off and the Cdn$ starts to rise, we will see better stock prices in the future.

He would be very careful. It is thinly traded. It is underperforming the market.

Toilet paper is a necessity. It has a nice yield. They are expanding their capacity. It is a low margin business, but he feels he can do okay with this one.

The largest branded tissue paper maker in Canada. They also sell private label tissue in the US through Wal-Mart. You would think that it would be a no-brainer business, especially with the growing population. Doesn’t know why the stock has been under pressure. Generating a lot more free cash flow than what people expect, because a lot of their CapX is for growth CapX. Dividend is fully covered and it gives a nice yield. Thinks the stock is worth $16-$17 a share. He is just going to be patient.

This is Cashmere and Scotties. A similar company was bought for a lot more than it traded at recently. People are selling it because it went down.

Fundamentals have improved a lot since they went public. They sell branded tissue in Canada and private label tissue in the US. They have clearly laid out a roadmap of how their growth is going to happen and have delivered on that. Pays a very nice dividend. Got hurt by a rising US$ and input pricing. Better times are ahead. An excellent dividend which is fully covered. Expects that in the next 1-2 years, the company will be flush with cash and will either increase the dividends or launch another manufacturing plant to get a bigger share in the US. Dividend yield of 5%.

Has underperformed. Thought they had a pretty good 1^st quarter. The big issue is that they buy pulp in US dollars, the Cdn$ continues to go down and the input costs continue to go higher. Tried to offset this by raising prices, so we are not going to see the effect of this until the2nd, 3^rd and 4th quarters. Pays a very nice dividend. The new plant in the US will be used to sell private label tissues to Wal-Mart (WMT-N) and have guided that by 2017 it will be filled up. They are actually looking to open up another plant, because capacity and demand is growing. He sees the potential for a dividend increase next year.

(Top Pick May 21/14, Up 12.27%) It has not lived up to his expectations. It was one thing after another. They buy all their commodity in US$ and pay with Canadian dollars and this hurt their margins. This one is for patient investors. He expects a dividend increase next year or the year after.

Has been no oomph in the stock and has been disappointing to investors. Launched a new manufacturing facility to try and get more private label toilet paper and tissues into the US via Wal-Mart (WMT-N). They are slowly, but surely, filling the pipeline, and earnings are going to grow. Respectable dividend of 4.45%. Valuation is very attractive. He is hoping that 2016 is going to be the break out year for this. You are getting paid to wait.

Makes toilet paper. Demand is not going away. The stock is not a huge trader, never put in a market order. He likes the company’s long term prospect. This is a competitive industry, but the dividend is good and he thinks you can make money on this.

Stock has underperformed, but pays a big, fat dividend. This is a branded toilet paper under the Cashmere brand in Canada, as well as private label brands in the US. Had a lousy year due to rising energy prices and pulp. It looks like things are reversing.

Ran into higher costs that all hit them at the same time. Input prices and product prices both rise and fall frequently. These guys are more worried about the next 5 years. They have a great relationship with Wal-Mart. They need to create more supply. Dividend should go higher next year. Great dividend.

(Market Call Minute.) Very pleased with the recovery in the stock in the past month and thinks there is still a lot more room for this to go higher.

Makes toilet paper. If there is ever a staple product that is not going to go out of business, toilet paper is going to be high on that list. Company commissioned a giant new plant in Tennessee, and is now coming up to full operation and what is expected in terms of margin. He expects to see free cash flow expand. Has a good yield 4.5%, which he expects to continue going forward.

(A Top Pick July 3/13. Down 0.32%.) Loves this company. Branded toilet paper and tissue company under the Cashmere brands. #1 leading market share in Canada. Has not gone anywhere, because energy and pulp prices have gone up. Also, has spent a lot of money building a new plant to get more exposure to Wal-Mart (WMT-N), but it hasn’t delivered the profits yet.

A terrific business to be in. Long-term, predictable revenue stream. Company has been slammed by higher input costs and misunderstood structure. At the end of the day, this has top quality toilet paper and is growing into the US. Dividend of 4.83% is totally safe. The major CapX spending is now over. He expects a dividend increase by the end of the year.

This stock has not worked out. It was a recent IPO in 2012-2013. Have been hit by a number of items such as higher pulp prices and higher energy prices. Thinks this is about to reverse coming into 2014. An interesting structure because it is not a company that owns a 15% interest in an operating company and some people are afraid of that structure. Pays a lovely dividend. Sees EBITDA rising over the next couple of years.

Does not see a compelling reason from the chart to buy it. 4.2% is a rather high yield for this stock.

#1 branded toilet paper in Canada and there won’t be a lot of technologies that can displace this kind of business. They are spending money for the future. Trying to institute a new project in the US to get more private-label demand. Signing up contracts and doing is slowly over time, which is depressing earnings right now. Trading at 25% discount to a Kimberly-Clark (KMB-N). 4.2% yield which he thinks will increase by the end of 2014.

Toilet paper, tissue paper, etc. This was a recent IPO. They have branded names such as Cashmere, Sponge Towel, etc. Have a nice relationship with Wal-Mart (WMT-N). Built a brand-new machine that will hopefully get more private-label business. At some point in time, the market will recognize that this is a nice stable, defensive product with a lovely dividend yield of 4.38%. Expects the dividend will be increased 3%-5% a year starting next year. Feels the valuation is worth $20-$25 a share.