UPMKF - UPM-Kymmene: Between A Rock And A Wooden Place But With Light In The Tunnel
2024-02-13 07:30:00 ET
Summary
- UPM-Kymmene, a timber and forest/paper company, has experienced a decline in valuation due to a 22% sales decline and a 52% decline in comparable EBIT for the full year.
- Despite the challenges, UPM has maintained its dividend payout at €1.5/share, showing support for this level.
- The company is focused on transitioning to growing businesses such as biorefining and the fiber/plywood segment, which offer higher rates of return on capital.
Dear readers/followers,
UPM-Kymmene (UPMKF) (UPMKY) is one of the best timber and forest/paper companies on the planet. That is why I own a non-trivial position in the company, and it's why when I rotated Billerud and Enso, two other companies in the same space because I saw challenges in the near and medium term, and saw structural weakness in valuation (which since then has materialized, and is now materializing, albeit slower in UPM than the others), I rotated at a good profit.
UPM Kymmene is, unfortunately, in no way saved or protected from these negative effects that we're seeing. In this article, we'll take a look at the FY23 results and look at where UPM can go from here....
UPM-Kymmene: Between A Rock And A Wooden Place, But With Light In The Tunnel