Top 10 Long Term Companies To Buy Right Now: Rayonier Inc. REIT(RYN)
Rayonier, Inc. engages in the sale and development of real estate and timberland management, as well as in the production and sale of cellulose fibers in the United States, New Zealand, and Australia. The company operates in four segments: Timber, Real Estate, Performance Fibers, and Wood Products. Timber segment owns, leases, or manages timberlands and sells standing timber at auction to third parties, as well as sells delivered logs. Real Estate segment sells medium and large tracts of land with infrastructure. This segment holds development and rural properties primarily in the southeast United States. Performance Fibers segment manufactures cellulose specialties that are used principally in acetate textile fibers, cigarette filters, rigid packaging, LCD screens, photographic film, impact-resistant plastics, high-tenacity rayon yarn, pharmaceuticals, cosmetics, detergents, food casings, and food products; and absorbent materials that are used in disposable baby diapers, feminine hygiene products, incontinence pads, convalescent bed pads, industrial towels and wipes, and nonwoven fabrics. Wood Products segment primarily manufactures and sells dimension lumber used for residential and industrial construction applications. In addition, Rayonier involves in trading and exporting logs, lumber, and wood panel products. As of December 31, 2005, it owned, leased, or managed approximately 2.5 million acres of timberland and real estate. The company has a joint venture with RREEF Infrastructure to own and manage timber lands in New Zealand. Rayonier has elected to be treated as a real estate investment trust (REIT) for federal income tax purposes and would not be subject to federal income tax on its REIT income that it distributes to its shareholders. The company, formerly known as Rainier Pulp & Paper Company, was founded in 1926. Rayonier is headquartered in Jacksonville, Florida.Advisors' Opinion:
- ! [By Ben Levisohn]
Timber! Shares of Rayonier (RYN) are tumbling like a felled tree after the timber real-estate investment trust missed earnings forecasts this morning, leading to downgrades from at least three investment banks.Jim Carlton
Rayonier reported a profit of 44 cents, below forecasts for a 46 cent profit, while revenue came in at $384.8 million, well below estimates for $422 million.
Deutsche Bank’s Mark Wilde and team cut Rayonier from Hold to Sell. They explain why:
While recent commentary around RYNs timberland and real estate operations has been quite encouraging, outlook for its Cellulose Specialties business (accounts for 72% of segment EBIT) suggests significant downside risks ahead. RYN said recent contract negotiations suggest a drop in 2014 cellulose specialties (CS) prices and slower transition to CS. Beyond lower cashflows, a sharp price drop could dampen bullish specialty chemicals valuations that have been floated for the segment. Pick-up in timber & real estate markets may mitigate some downside pressure on stock, but they wont eliminate it.
Raymond James analyst Collin Mings and slashed their rating on Rayonier to Market Perform from Strong Buy:
We are lowering our rating on Rayonier to Market Perform from Strong Buy as we expect concerns over a slower-than-expected ramp in incremental specialty-grade dissolving pulp sales volumes and 2014 specialty-grade dissolving pulp price negotiations will prove to be a near-term headwind for RYN shares. Longer-term, we continue to believe its cellulose specialties expansion (CSE) project sets the foundation for significant cash flow (and dividend) growth. We remain attracted to the multi-year growth prospects of this business and the barriers-to-entry competitors face to gaining meaningful market share over a sustained period. However, commentary on yesterdays conference call made it clear that the timeline for Rayonier to realize the full benefits o
- [By Saibus Resea! rch] !
WY and the majority of the timber, forest and paper products companies have a track record of unimpressive returns on capital, cyclical revenue and profit trends, heavy use of capital expenditures, and significant environmental regulation. We also think that WY's conversion to a REIT was a mistake. Morningstar Investment Research's Timber, Forest and Paper Products analyst Dan Rohr said it best when he rated WY and its Timber REIT peers Rayonier (RYN), Potlatch (PCH) and Plum Creek (PCL) as not possessing any economic moat. That probably explains why we only have an ancillary exposure to this industry for our proprietary portfolio based on our holdings in Brookfield Infrastructure (BIP) and Cintas (CTAS). Brookfield's Timber segment only accounts for 5% of its Fund Flows from operations and Cintas's document management business is suffering from reduced prices on recycled paper. At least Cintas Document Management only accounts for 8% of Cintas's revenue.
source from Top Penny Stocks For 2015:http://www.seekpennystocks.com/top-10-long-term-companies-to-buy-right-now-2.html