Investors looking for signs of life in the paper sector got a markedly mixed message on Wednesday evening from the earnings of Packaging Corp. of America
Even though Packaging Corp. won't have growth-fund managers falling over each other to buy shares, this year does represent the first since 2000 that the company was able to show year-over-year growth. It was also able to post net margins (after charges and gains) of more than 6% -- considerably better than the essentially zero margin of a year ago.
The way Packaging Corp.'s results seem to have bottomed out and are just starting their climb back up mirrors the entire industry's fortunes as of late. Unlike the steelmakers or energy producers, paper-company stocks have not really had a heyday or enjoyed the Wall Street love-in for commodities over the past 18 months. Look no further than International Paper's
In broad terms, paper is suffering from the same problem that I highlighted in a piece on Alcoa
In that sense, Packaging Corp. did provide a bit of good news: Demand appears to be picking up, and pricing continues to improve. That won't make every paper-company stock a winner, but mills such as UPM-Kymmene Oyj
Fool contributor Stephen Simpson holds a CFA and has no ownership interest in any stocks mentioned.