TSX:RFP

Stock Analysis Report

Resolute Forest Products

Executive Summary

Resolute Forest Products Inc. operates in the forest products industry in the United States, Canada, Mexico, and internationally.

Snowflake

Fundamentals

Undervalued with solid track record.


Similar Companies

Share Price & News

How has Resolute Forest Products's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

2.3%

RFP

6.3%

CA Forestry

0.2%

CA Market


1 Year Return

-60.2%

RFP

-18.0%

CA Forestry

3.5%

CA Market

Return vs Industry: RFP underperformed the Canadian Forestry industry which returned -18% over the past year.

Return vs Market: RFP underperformed the Canadian Market which returned 3.5% over the past year.


Shareholder returns

RFPIndustryMarket
7 Day2.3%6.3%0.2%
30 Day-6.2%2.3%-3.3%
90 Day-26.6%5.1%-1.9%
1 Year-53.9%-60.2%-15.5%-18.0%7.3%3.5%
3 Year13.3%-2.1%6.7%-0.6%14.7%4.4%
5 Year-64.9%-69.7%0.7%-7.1%26.2%7.7%

Price Volatility Vs. Market

How volatile is Resolute Forest Products's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Resolute Forest Products undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: RFP (CA$6.1) is trading below our estimate of fair value (CA$13.46)

Significantly Below Fair Value: RFP is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: RFP is good value based on its PE Ratio (2x) compared to the Forestry industry average (16.6x).

PE vs Market: RFP is good value based on its PE Ratio (2x) compared to the Canadian market (13.7x).


Price to Earnings Growth Ratio

PEG Ratio: RFP's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: RFP is good value based on its PB Ratio (0.3x) compared to the CA Forestry industry average (1x).


Next Steps

Future Growth

How is Resolute Forest Products forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

-65.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RFP's earnings are forecast to decline over the next 3 years (-65.5% per year).

Earnings vs Market: RFP's earnings are forecast to decline over the next 3 years (-65.5% per year).

High Growth Earnings: RFP's earnings are forecast to decline over the next 3 years.

Revenue vs Market: RFP's revenue is expected to decline over the next 3 years (-4.5% per year).

High Growth Revenue: RFP's revenue is forecast to decline over the next 3 years (-4.5% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if RFP's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Resolute Forest Products performed over the past 5 years?

59.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: RFP has become profitable over the past 5 years, growing earnings by 59.6% per year.

Accelerating Growth: RFP's earnings growth over the past year (84.9%) exceeds its 5-year average (59.6% per year).

Earnings vs Industry: RFP earnings growth over the past year (84.9%) exceeded the Forestry industry -33.7%.


Return on Equity

High ROE: RFP's Return on Equity (13.8%) is considered low.


Return on Assets

ROA vs Industry: RFP has a higher Return on Assets than the Forestry industry average last year.


Return on Capital Employed

ROCE Improving: RFP has significantly improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Resolute Forest Products's financial position?


Financial Position Analysis

Short Term Liabilities: RFP's short term assets ($1.1B) exceeds its short term liabilities ($385.0M)

Long Term Liabilities: RFP's short term assets (1.1B) do not cover its long term liabilities (1.8B)


Debt to Equity History and Analysis

Debt Level: RFP's debt to equity ratio (26%) is considered satisfactory

Reducing Debt: RFP's debt to equity ratio has increased from 21.1% to 26% over the past 5 years.

Debt Coverage: RFP's debt is well covered by operating cash flow (74.5%).

Interest Coverage: RFP's interest payments on its debt are well covered by EBIT (8.9x coverage).


Balance Sheet

Inventory Level: RFP has a high level of physical assets or inventory.

Debt Coverage by Assets: RFP's debt is covered by short term assets (assets are 2.6x debt).


Next Steps

Dividend

What is Resolute Forest Products's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%2.0%markettop25%5.9%industryaverage2.8%forecastin3Years0%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: Unable to evaluate RFP's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate RFP's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.

Stable Dividend: Insufficient data to determine if RFP's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if RFP's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of RFP's dividend in 3 years as they are not forecast to pay a notable one for the Canadian market.


Next Steps

Management

What is the CEO of Resolute Forest Products's salary, the management and board of directors tenure and is there insider trading?

1.9yrs

Average management tenure


CEO

Yves Laflamme (62yo)

1.7yrs

Tenure

US$4,748,111

Compensation

Mr. Mr. Yves Laflamme has been the President and Chief Executive Officer and as board member at Resolute Forest Products Inc. since February 01, 2018 and served as its Senior Vice President of Wood Product ...


CEO Compensation Analysis

Compensation vs. Market: Yves has recently become CEO, making it difficult to compare their total compensation against companies of similar size in the Canadian market.

Compensation vs Earnings: Yves's compensation has increased by more than 20% in the past year.


Management Age and Tenure

1.9yrs

Average Tenure

54.5yo

Average Age

Experienced Management: RFP's management team is not considered experienced ( 1.9 years average tenure), which suggests a new team.


Board Age and Tenure

6.4yrs

Average Tenure

61.5yo

Average Age

Experienced Board: RFP's board of directors are considered experienced (6.4 years average tenure).


Insider Trading

Insider Buying: RFP insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$100,42712 Aug 19
Randall Benson
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares15,000
Max PriceUS$6.70
BuyUS$15,67505 Aug 19
Daniel Ouellet
EntityIndividual
Shares2,270
Max PriceUS$6.91
BuyUS$34,25913 Jun 19
Jennifer Dolan
EntityIndividual
Role
Member of the Board of Directors
Director
Shares4,152
Max PriceUS$8.25
SellUS$131,70631 May 19
Richard Tremblay
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Pulp & Paper Operations
Shares15,004
Max PriceUS$8.78
SellUS$470,20826 Feb 19
Jacques Vachon
EntityIndividual
Role
Chief Legal Officer
Senior VP of Corporate Affairs
Shares41,916
Max PriceUS$11.23
SellUS$3,22326 Feb 19
Jacques Vachon
EntityIndividual
Role
Chief Legal Officer
Senior VP of Corporate Affairs
Shares300
Max PriceUS$10.74
SellUS$156,65314 Dec 18
John LaFave
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Pulp & Paper Sales & Marketing
Shares12,500
Max PriceUS$12.53

Ownership Breakdown


Management Team

  • Jacques Vachon (59yo)

    Senior VP of Corporate Affairs

    • Tenure: 12yrs
    • Compensation: US$1.65m
  • Richard Garneau (71yo)

    Special Advisor to President & CEO

    • Tenure: 1.7yrs
    • Compensation: US$4.67m
  • Yves Laflamme (62yo)

    President

    • Tenure: 1.7yrs
    • Compensation: US$4.75m
  • Seth Kursman

    Vice President of Corporate Communications

    • Tenure: 17.8yrs
  • John LaFave (54yo)

    Senior Vice President of Pulp & Paper Sales & Marketing

    • Tenure: 8.8yrs
    • Compensation: US$1.56m
  • Silvana Travaglini (53yo)

    VP of Investor Relations & Treasurer

    • Tenure: 7.9yrs
  • Rémi Lalonde (42yo)

    Senior VP & CFO

    • Tenure: 0.9yrs
    • Compensation: US$2.36m
  • Richard Tremblay (55yo)

    Senior Vice President of Pulp & Paper Operations

    • Tenure: 1.6yrs
    • Compensation: US$1.79m
  • Hugues Dorban (42yo)

    Chief Accounting Officer & VP

    • Tenure: 2.1yrs
  • Lori Kilgour

    Senior VP of Process Improvement & Chief Information Officer

    • Tenure: 0.8yrs

Board Members

  • Randall Benson (59yo)

    Independent Director

    • Tenure: 2.4yrs
    • Compensation: US$204.72k
  • Mike Rousseau (61yo)

    Independent Director

    • Tenure: 8.8yrs
    • Compensation: US$260.56k
  • Jennifer Dolan (72yo)

    Director

    • Tenure: 6.4yrs
    • Compensation: US$186.93k
  • Brad Martin (59yo)

    Non-Executive Chairman

    • Tenure: 6.4yrs
    • Compensation: US$635.67k
  • Suzanne Blanchet (61yo)

    Independent Director

    • Tenure: 0.8yrs
  • Alain Rhéaume (67yo)

    Lead Director

    • Tenure: 6.4yrs
    • Compensation: US$280.56k
  • Yves Laflamme (62yo)

    President

    • Tenure: 1.7yrs
    • Compensation: US$4.75m
  • Dick Falconer (74yo)

    Director

    • Tenure: 8.8yrs
    • Compensation: US$297.89k

Company Information

Resolute Forest Products Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Resolute Forest Products Inc.
  • Ticker: RFP
  • Exchange: TSX
  • Founded:
  • Industry: Paper Products
  • Sector: Materials
  • Market Cap: US$421.467m
  • Listing Market Cap: US$551.712m
  • Shares outstanding: 89.29m
  • Website: https://www.resolutefp.com

Number of Employees


Location

  • Resolute Forest Products Inc.
  • 111 Robert-Bourassa Boulevard
  • Suite 5000
  • Montreal
  • Quebec
  • H3C 2M1
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RFPNYSE (New York Stock Exchange)YesCommon StockUSUSDDec 2010
RFPTSX (The Toronto Stock Exchange)YesCommon StockCACADDec 2010
7AB1DB (Deutsche Boerse AG)YesCommon StockDEEURDec 2010
0KW8LSE (London Stock Exchange)YesCommon StockGBUSDDec 2010

Biography

Resolute Forest Products Inc. operates in the forest products industry in the United States, Canada, Mexico, and internationally. The company operates through five segments: Market Pulp, Tissue, Wood Produ ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/24 00:22
End of Day Share Price2019/10/23 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.