International Paper (IP-N)

He is neutral on this. The company has transformed its business over the last 20 years from printing newspapers to making cardboard boxes. This is both, a great growth industry and a very mature industry. The company sells at 15x earnings, which is a relatively high multiple for a mature business. International Paper is the leader in the industry, so the company is safe, but it will probably just continue to plug along. He would look elsewhere for an opportunity.

Over the past 10-15 years, they've re-focused from paper-based to cardboard-based shipments. They're likely struggling with paper industry issues--China is a disruptor by sucking up the used paper in the States then re-processing it. The high American dollar doesn't help. It's a well-managed company.

You have the declining paper sales. People are using iPads, and don’t need paper. On the other hand, they make packaging, and sales are going up because of Amazon (AMZN-Q) and e-commerce. Looking at earnings and free cash flow, it looks like their growth from packaging is beating out the loss of revenues from paper. You also get a nice dividend of 3.3%.

We are in a process of reflating the system and materials are behaving quite well. Breadth is expanding and momentum is improving. He owns another. This one does look good and pricing is firm. They should continue to do well. He really likes the timber companies, though.

He like this and the sector. How do we get everything we buy on Amazon? It comes in packages which are made from paper. The companies that get involved will do well. He loves it.

(Top Pick Jul 2/14, Up 2.98%) They have been suffering from the strong dollar. In the future you will see better comps and better balance sheet strength. You are starting to see slow growth.

It is struggling a bit on global demand dropping and the US$ becoming so strong. The US$ may be rolling over and that would help, but he would not be going out buying the stock. He prefers Canadian paper companies.

A great, deep value play. You get paid to wait with a sustainable dividend. This is a favourable entry point. Strong management team. Yield of 2.8%.

Of all commodities, he does like some of the forest stocks on the lumber side. There has been no additional capacity come to market. Would prefer to focus on Canadian lumber companies such as Canfor (CFP-T) or Western Forest (WEF-T), which really benefit from the weakening Canadian dollar.