Goldman Sachs’ Stocks With Highest Consensus Returns: 42 Stocks With The Highest Consensus ROE

4. International Paper Company (NYSE:IP)

Consensus ROE: 46%

Number of Hedge Fund Investors in Q2 2024: 44

International Paper Company (NYSE:IP) is one of the biggest cardboard and pulp manufacturing companies in America. This makes the stock dependent on the economic environment, with increased activity translating into a great demand for its products. Consequently, the slow industrial environment in America stemming from high interest rates has also made an impact on International Paper Company (NYSE:IP)’s income statement. Between 2022 and 2023, the firm’s revenue dropped by 11%, and to reverse the trend, the firm is currently embarking on a strategy that prioritizes value over volume. If this strategy is successful, then International Paper Company (NYSE:IP) could end up bolstering its margins and improve bottom line earnings. The stock is up by 30% year to date, primarily on the back of a now ended acquisition bid for the company by a Brazilian firm. Additionally, with the containerboard market now improving, International Paper Company (NYSE:IP) could see higher prices for these products and add to its top line.

Diamon Hill Capital mentioned International Paper Company (NYSE:IP) in its Q2 2024 investor letter. Here is what the fund said:

“Other top individual contributors in the quarter included Coherent and new holding International Paper Company (NYSE:IP). International Paper is one of the US’s largest manufacturers of containerboards, which is used to make corrugated boxes and other packaging materials. We expect that as the demand environment improves and the company focuses on its commercial execution, it will be able to improve profitability and bring operating margins back to normalized levels. Given what we view as an attractive valuation for a high-quality company, we capitalized on the opportunity to initiate a position in Q2. Shares subsequently rallied after reports that Brazilian company Suzano is interested in acquiring the company.”