Industry Reports

Deutsche Bank Reports Summaries

071116 Deutsche Bank Report - Dr. Paper's Weekly Wrap Up (11/16/07)

Deutsche Bank - Equity Research

Takeaways from the Oct. containerboard numbers? Mediocre demand, but very tight inventories. Avg. week box vol's fell 2.8% y/y, and actual vol's rose 1.6% y/y, for a blended avg. decline of 0.6%. Inventories fell 179K tons m/m (vs. 10-yr avg decline of 53K tons), taking total inv. below 2.2MM tons.

Sino-Forest reported disappointing 3Q results on Monday. As expected, income statement metrics were strong, but free cash flow remained negative. The real negatives? Higher-than-expected land lease costs and a potential freeze of Russia's log export tariff at 20%. We maintain our Sell rating and $12 price target.

Notes from Ohio Paper & Packaging investor trip: 1) Greif is shifting to a more aggressive growth strategy and executing well, 2) Newpage will file anti-dumping claims against the Europeans, which could accelerate restructuring in the global coated paper sector.