Neenah Paper (NP-N)

(A Top Pick March 1/17. Up 25%.) A funny little company that was a spinoff from Kimberly-Clark. When it was spun off, it was selling fancy gloss paper. What they did was to use the free cash flow to get into the technical products business such as filtration devices, adhesive, labels, etc. They are dominating in that business. Has a lot of potential in Europe, especially in the automotive market. Valuation is very attractive. You are going to see significant earnings growth in 2018, and a big beneficiary from tax reform.

Despite its name, only half its business is in paper. They manufacture heavy quality card stock. Their paper business is a cash cow, and they are using the free cash flow to invest in technical products like filtration and other devices and products for packaging. Run by a very smart management team. Many years of dividend growth. In the past few weeks, this has dropped out of the skies, and he doesn’t know why. Dividend yield of 2.02%. (Analysts’ price target is $84.)

(A Top Pick Aug 5/14. Up 17.48%.) Half of its business is making fine paper and the other half is making filtration products, labels and packaging. Generating a lot of free cash flow and are making more acquisitions. They continue to raise their dividend. Still a Buy.

A spin-off from Kimberley Clark (KMB-N). It’s big business is fine paper, stationary, etc. but there is no growth in that. They are focusing on labels and filtration where there is a lot of growth. Operate in health care and automotive and they have great return on capital. High ROE and buying back stock. Yield of 2.16%.