A lump sum investment in 1990 in the common shares of Repap Enterprises
Inc. would have produced a compound annual rate of return of 6.59% if the
investment was divested on June 9, 1995. A lump sum investment in 1990
in the common shares of International Paper Co. would have produced a compound
annual rate of return of 11.36% if the investment was divested on June
9, 1995. The closing prices on June 9, 1995 for Repap and International
were $CDN 10.25 and $US 79.25, respectively.
[Since June 12, 1995 International Paper has had a 2 for 1 stock split.]
Repap Enterprises Inc. is a fully integrated North American forest products company specializing in coated paper. Repap has invested $CDN 3 billion over the past ten years upgrading existing assets and adding three new high capacity paper machines. Repap returned to profitability in the last quarter of 1994 after three years of staggering losses. For Repap the recovery part of the business cycle is finally here and appears to be one of the strongest in history. I expect an investment in Repap will produce a compound annual rate of return of 15 to 20% over the next eighteen months.
International Paper Co. is a global forest products company and is one
of the companies included in the Dow Jones Industrial Average. The recovery
is here for International Paper too, and I expect an investment in International
Paper will produce a compound annual rate of return of 10 to 15% over the
next eighteen months.
Click here to view Table 1.1 Comparative
Earnings Performance.
Click here to view Table 1.2 Price Earnings
Ratios.
Click here to view Table 1.3 Record of Common
Dividends.
Click here to view Table 1.4 Financial Position
and Capitalization.
Click here to view Figure 1.1 Balance Sheet
Ratios.
Click here to view Figure 1.2 Earnings and
Retained Earnings Statement Ratios.
Click here to view Figure 1.3 Combined Ratios.
Click
here to view Figure 1.4 Value Ratios.
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