Suzano S.A. SUZ announced that it closed the acquisition of two industrial assets from Pactiv Evergreen PTVE in Arkansas and North Carolina. This move will boost the company's operations across North America, entering consumer and food service packaging segments in the region.

Details on SUZ’s Pactiv Evergreen Assets’ Buyout Deal

On July 12, 2024, Suzano agreed to purchase the mills in Pine Bluff and Waynesville that produce liquid packaging boards and cupstock. This increases Suzano's production capacity by roughly 420,000 metric tons of integrated paperboard per year. The acquired assets offer strategic advantages, given the high availability and competitive prices for wood and energy in the region, as well as easy access to railways, ports and highways.

The deal is valued at $110 million. It has no significant impact on Suzano's debt levels.

Under a long-term commercial agreement, SUZ will provide a liquid packaging board for Pactiv Evergreen’s converting mills in North America.

Transaction to Boost Suzano's Position

The acquisition makes the Brazilian company Suzano a leading supplier of Liquid Packaging Board papers in North America. This deal will help it meet the growing global demand for paper-based packaging. 

The company's proven integration expertise will enhance operational efficiency, production scale and safety standards, benefiting employees and local communities.

SUZ’s Q2 Top Line Increases Y/Y

In the second quarter of 2024, Suzano reported net sales of $2.2 billion, up from $1.8 billion in the prior-year quarter. It reported an adjusted loss of 56 cents in the quarter under review against the prior-year quarter’s earnings of 79 cents.

Suzano's Share Price Lags Industry

SUZ shares have lost 3.5% in the past year against the industry's 32% growth.

 

Image Source: Zacks Investment Research

 

Zacks Rank & Stocks to Consider

Suzano currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks from the basic materials space are Carpenter Technology Corporation CRS and IAMGOLD Corporation IAG. CRS and IAG  both sport a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Carpenter Technology’s fiscal 2025 earnings is pegged at $6.09 per share. The consensus estimate for its 2025 earnings has moved 7% north in the past 60 days. It has an average trailing four-quarter earnings surprise of 15.9%. CRS shares have gained 127.1% in a year.

The Zacks Consensus Estimate for IAMGOLD’s 2024 earnings is pegged at 39 cents per share. The consensus estimate for 2024 earnings has moved 36% north in the past 60 days. It has an average trailing four-quarter earnings surprise of 200%. IAG shares have gained 152.6% in a year.