- IP survived a pretty challenging 2020, which saw pandemic headwinds for its Printing Paper Segment. In December, the company announced it would spin-off the segment.
- That's likely a good decision considering the Printing Paper Segment is likely in structural decline given the global move toward digitization.
- However, since the spin-off will cause an estimated 30-40 cent cut in IP's dividend, it may not unleash much shareholder value.
- Currently I find IP to be fairly valued after a recent strong run in the stock. That makes it a HOLD for current shareholders (yields 3.8%), but advise others to look elsewhere for income and growth.
For further details see:
International Paper: Spin-Off Of Printing Paper Segment Not Likely To Unleash Much Shareholder Value