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Why It Appears The Market Overreacted To Clearwater's Earnings Results

Clearwater Paper Corporation (CLW) reported its 2014 full year results on February 4. On the following day, the company closed at a share price of $60.02 on February 5, pricing the company at a market capitalization of $1.17 billion. This represented a steep decline of 18.63% for the day's session on high volume of 1.65 million shares, which was more than 10 times the average daily volume of the last 3 months. Yet despite the harsh sell-off, there is little reason to believe that the market's volatile reaction was justified in its degree.

Clearwater Paper Company is a manufacturer of private label tissue and paperboard products. The company is a leading North American producer of facial and bath tissue, paper towels, and napkins. Additionally, the company sells its paperboard to the packaging industry. The company maintains two primary business segments found in Consumer Products and Pulp and Paperboard. As of… Read More …