An inside-the-box holiday stock

International Paper has turned itself into the most important container board company in the world -- just as e-commerce has exploded.

By Jim Cramer Dec 7, 2011 10:36AM

the streetHow about a lower-risk play on all of that online shipping? How about the company that makes the boxes for the goods that come in the mail this season?

 

Over the last five years, International Paper (IP) has turned itself into the most important container board company in the world. It did so in the nick of time because e-commerce is about shipping things that would normally be thrown into a bag at the store. Now those same products are more than likely to end up in a linerboard package that would very likely be made by IP, at least once the Temple Inland (TIN) deal closes.

 

Everyone is worried about this company and the potential collapse of world trade if Europe goes bad. Instead they should be looking at what will happen when the lowest cost producer of a commodity suddenly gets an uptick in sales, and what that does to the bottom line.

 

That's where we are now with IP, as it is by far the lowest-cost producer and its numbers factor in about a 1% growth in the business. No more than that.

 

If we do see any pickup, a monstrous amount of that money will fall to the bottom line. In the interim, you are being paid to wait with a hefty 3.7% yield and earnings estimates that I believe it will have no problem meeting.

 

Action Alerts PLUS, which Cramer co-manages as a charitable trust, has no positions in the stocks mentioned.

 

Related Articles

jim cramerJim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for his charitable trust.

13Comments
Dec 7, 2011 11:18AM
avatar

BEWARE  the shyster had the ceo of IP on his show.....do your research and you will find that

within 6 months there is a huge probabiliy of this stock gapping down 

Dec 7, 2011 12:06PM
avatar
Cramer Boo Hoo. Flip a coin yourself and you'll do better. His wife saved him from bankruptcy 3x. In the dotcom crash he said buy right up to the crash. In 2008 he said the mkt won't be back in this decade, wrong again Cramer.
Dec 7, 2011 11:42AM
avatar

hey puppet boy......i dumped my OIH at 127 the day you recommended oil services

 

MAN WOULD I LOVE TO COMPETE WITH YOU PICKING STOCKS......IT WOULD BE LIKE

THUMPING A DEAD PERSON...........QUIT PROSTITUTING YOURSELF TO YOUR OWNERS  

Dec 7, 2011 1:39PM
avatar

THE BOARD IS UNANIMOUS MSN SHOULD DUMP THIS UNFUNNY CLOWN

 

 

NOW

Dec 7, 2011 4:20PM
Dec 7, 2011 2:46PM
avatar

Jimmy, you are the dump on the news guy , thanks for being schizophrenic , it's really easy to make a buck off you, with that red nose and oversized shoes, hey,  let that fringe of hair grow a little longer, and you can be Bobo the Clown, in looks and actions . slip and fall ,  but make a buck doing it .  Bet against , what you say ,go jimmy go., hasta nunca

 

Dec 7, 2011 2:29PM
avatar
Under contract.If you fire someone I think they will make more on severance pay. Better to keep that person on the payroll until their contract is finished. I would rather read into these articles and try a play opposite of what is recommended. Can't do any worse than losing I guess.Black SheepBlack SheepBlack Sheep
Dec 7, 2011 12:07PM
avatar

It all makes since to me but because it came out of you mouth?????????????

Dec 7, 2011 12:07PM
avatar

CLUE FOR CLOWN MAN..........4 PERCENT YIELD DOES NOT PROTECT YOU FROM

A GAP DOWN ...............IF A PERSON MUST BUY AN INDIVIDUAL STOCK WITH ALL

OF ITS IMPOSSIBLE TO KNOW RISKS IT SHOULD BE PROPERLY HEDGED WITH

OPTIONS ...........YOUR STRATEGY OF LOSING LESS WITH HIGH YIELDERS IS STILL

LOSING.........SHOULDN'T THE GOAL BE TO WIN WHETHER LONG OR SHORT?

 

Dec 7, 2011 12:51PM
avatar
cnbc continues to be impressed with guests who either pay for advertising or who peddle influence. political hacks and wallstreet shills gin up 'advice/opinion' and hurt small investors.tune out cnbc (can not buy credibility) and Buy American and support our Troops.
Dec 7, 2011 4:26PM
avatar

i know i'm repeating myself but beware of IP ..........the unfunny clown had the venerated ceo

on his program last night so a gap down is coming

Dec 7, 2011 5:41PM
avatar
ip has a ton of debt and issues more.selling trees to wy is questionable.
Dec 7, 2011 1:38PM
avatar

Regardless of what people think of Cramer or the quality of his advice, it's good to see him and others start to push investment in second and third tier Internet companies.  Why is it that only Silicon Valley investors understand that the Web and all its iterations are where the growth is?  Just because the investment analytics and algorithms don't fit traditional analysis doesn't mean we shouldn't be encouraging all those investors who have some $9 trillion tucked in their mattresses to get involved.  The sooner...and the bigger...the better. 

Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

STOCK SCOUTER

StockScouter rates stocks from 1 to 10, with 10 being the best, using a system of advanced mathematics to determine a stock's expected risk and return. Ratings are displayed on a bell curve, meaning there will be fewer ratings of 1 and 10 and far more of 4 through 7.

109
109 rated 1
276
276 rated 2
421
421 rated 3
629
629 rated 4
511
511 rated 5
538
538 rated 6
686
686 rated 7
507
507 rated 8
331
331 rated 9
109
109 rated 10
12345678910

Top Picks

SYMBOLNAMERATING
KOGKODIAK OIL & GAS Corp10
UPLULTRA PETROLEUM Corp10
TAT&T Inc9
COPCONOCOPHILLIPS9
DVNDEVON ENERGY CORPORATION9
More

VIDEO ON MSN MONEY

ABOUT

Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.

Contributors include professional investors and journalists affiliated with MSN Money.

Follow us on Twitter @topstocksmsn.