CASCADE a real bargain nowToday Rock-Tenn bought Smurfit-Stone, a carboard producer for 3.5billions in cash and stock at $35 a share or 6.1 times Smurfit-Stone EBITDA. ( 7.5 millions capacity mill)
Cascade has a carboard division making a EBITDA of 135 millions being 34% of CASCADE total EBITDA of 400 millions.
Last year Graeme Hart 's Rank group paid 8.4 times EBITDA for Pactiv Corp an other carboard company.
At 6.1 times EBITDA , the Cascade carboard division only would value 825 millions compare to those last two acquisitions.
So, at $ 6.80 a share now, CASCADE is value at only at 660 millions for the whole company .
If we assume the same bases, "The whole CASCADE" operation including the soft paper division and the box board division generate 400 millions EBITDA ,at the same ratio, it would value Cascade at 2.4 billions ...or $24 plus a share...beleive it or not.......
In top of this when you own a Cascade share, you own some BORALEX (BLX.TO) share value at more than $1 per Cascade share too..... Also. Cascade own a french company value at Cascade share about
.50 plus.....
Now Cascade trade at 2.6 times CASH FLOW......and with first class MANAGEMENT...., that have prouved in the past that they can handle very rought times too....
Very few stock trade at such low price.....