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If you're like most people, no sooner does someone start

yammering about paper and forest companies than you have to stifle a yawn.

Who wants to think about these outfits when you could be throwing money into the company that has "The Next Jack Welch" at its helm, or when there's just been a report detailing "The Coming Rally in Chip Stocks"? Paper stocks in general have been dead money for so long that most investors have forgotten they even exist.

But all that is part of the point. The best time to invest in something is not when everybody hates it, but when hate has given way to a lack of interest. People forget, but money market funds -- not stocks -- were the rage when the bull market started in the early 1980s. Technology stocks were all the rage in the 1990s, but people forget that in the early part of the decade, Wall Street firms were cutting away at tech research.

Paperless Society?

Lately, it has been paper analysts who have been getting dropped from research departments. Over the past four years, for example, the number of analysts covering

International Paper

(IP) - Get International Paper Company Report

has plunged to 12 from 18, according to Thomson Financial/First Call. Small wonder there -- trading volume in the company and its brethren has been tepid. Average daily volume in IP has fallen 14% from last year.

Boise Cascade's

(BCC) - Get Boise Cascade Co. Report

is down 10% and

Weyerhaeuser's

(WY) - Get Weyerhaeuser Company Report

is down 21%. Meanwhile, combined average daily volume on the

TheStreet Recommends

New York Stock Exchange

and the

Nasdaq Stock Market

is up 12%.

Historically, these companies' stocks have rallied sharply in the latter stages of an economic downturn, as investors anticipate recovery in these highly cyclical businesses. So by the end of the March 1991 -- the trough month for the last recession -- Weyerhaeuser (not the most extreme example) had seen its stock rally 39% from its November low.

Paper Losses
Analysts covering International Paper

Source: Thomson Financial/First Call

Onto the typical cyclical upturn, says Morgan Stanley strategist Byron Wien, add the investor neglect for the basic materials companies in general, and you could end up with something powerful. They make up for only 2.6% of the

S&P 500's

market capitalization these days. That means that big mutual funds, whose portfolios tend to mimic the index's weighting, aren't paying very close attention. If the sector begins to perform as it has in the past coming out of recession, argued Wien in a recent note, and investors start paying more attention, "the impact on prices could be dramatic: A little money could go a long way."

Thinking Inside the Box

Pulp and paper companies specifically were among the earliest to feel the effects of the economic slowdown. If economists (including those at the

Fed) had taken a look at corrugated-box sales last year, they might have concluded a lot earlier that the economy was in for more than a normal cooling-off period. The industry itself began cutting back inventories in August of last year, according to Commerce Department statistics, and it's been clearing away excess capacity throughout this year.

Yet there are risks here if the economy's bottom doesn't come, as both Wien and the market-at-large have concluded, within the next several months. As is typical for cyclical stocks when investors are anticipating a recession to end,

price-to-earnings ratios are high. And neglected or not, along with everything else, cyclicals have rallied hard since the market bottomed on Sept. 21.

Finally, notes Credit Suisse Asset Management managing director Stanley Nabi, it's doubtful that the paper and forest product industry will get the kind of pricing power it has had during past cyclical upturns. Economies around the world are slipping in reaction to the U.S. downturn, and even when things begin improving here, they will probably have months to go before they touch bottom. The stocks should perform OK in the coming months, he says, but "I don't think they're going to give you the kind of mileage that a lot of people are talking about."