Sector Snap: Paper And Forest Products Upgraded

NEW YORK (AP) — An analyst upgraded the paper and forest products sector, as well as individual wood products companies, on evidence that many such firms are poised for a rebound.

Goldman Sachs analyst Richard Skidmore raised his rating on the sector to "Neutral" from "Cautious" on prospects that the U.S. housing market has reached a bottom, global lending is up and on stronger manufacturing data — all of which suggest a recovery for paper and forest products companies.

"Producer inventories have been better managed this downturn than previously," Skidmore wrote in an analyst note. "Capacity closures have positioned the industry well for the cyclical rebound. We see corrugated box and wood products demand improving sequentially in the second quarter of 2009." ...