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Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

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Equity Bottom-Up

Rayonier Advanced Materials / Equity Bottom-Up

<ul><li>4Q23 disappoints but headwinds subsiding. RYAM reported 4Q23, which included solid revenue of $422 million, ahead of our estimate of $373 million.</li><li>However, adjusted EBITDA of $37 million fell well short of Street expectations and our $48 million forecast on weaker-than-expected paperboard demand and lower-than-anticipated pulp prices.</li><li>Right-sized inventory suggests modest growth. With customer channel destocking largely completed in 4Q23, RYAM’s businesses should see a more stable demand environment throughout 2024 and, combined with modest share-driven volume growth and lower input costs, improved gross and EBITDA margins.</li></ul>

4Q23 disappoints but headwinds subsiding. RYAM reported 4Q23, which included solid revenue of $422 million, ahead of our estimate of $373 million.However, adjusted EBITDA of $37 million fell well short of Street expectations and our $48 million forecast on weaker-than-expected paperboard demand and lower-than-anticipated pulp prices.Right-sized inventory suggests modest growth. With customer channel destocking largely completed in 4Q23, RYAM’s businesses should see a more stable demand environment throughout 2024 and, combined with modest share-driven volume growth and lower input costs, improved gross and EBITDA margins.

Rayonier Advanced Materials, Inc. - 2024 Looks Like a Recovery Year with Potential Asset Sale Kicker