Votorantim Celulose e Papel S.A (ADR) (NYSE:FBR)

CAPS Rating: 3 out of 5

The Company is a pulp and paper products company in Brazil. The company produces eucalyptus pulp and manufactures a range of printing and writing paper products.

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Player Avatar fdude71 (72.49) Submitted: 6/4/2010 1:11:33 PM : Outperform Start Price: $14.73 FBR Score: -65.48

early June 20104 StarsFBR is the world leader supplying leader of bleached eucalyptus pulp.This is a merger stock in the wood pulp industry between ARA and VCP.The company owns a ton of land in Brazil and makes pulp out of eucalyptus trees, these trees grow faster in Brazil than anywhere else in the world (avg of 7 years compared to decades in North America for example)... so they "crush" competition. They produce more than 50% more than their closest competitor... moat anybody?This said, financials do not look great at this point but the company is looking at unloading one of it's plant for almost $1.5 Billion... this will help with debt load and such. Also, appreciation of the Real should help there too.Would rather buy lower than $15 to mitigate the debt/currency risk, though the company is consistently making cash and set to outperform in the long run in my opinion as we are buying this cyclical toward the bottom as the world economy is starting to recover... so adding it to CAPS now and will look into adding to RL portfolio when the opportunity is there.

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