RE:RFP vs. IFP Ooof. That's quite a take. I have concentrated positions in both, larger to RFP. Add in WFG and ADN for the hyper-concentrated yet conservative set of holdings.
IFP is still ahead on cap by about 12% or $200M. They're both deep value plays but with the moderation of lumber it's no longer just a comparison of 3 billion FBM capacity (RFP) vs. 4.9 billion (IFP). Obs IFP has the edge on lumber in both cash conv. costs and locations.
IFP should be trading at lumber's new replacement cost, something like $800/mfbm. So, $4B. It's got 100% upside. That's not going to be realized at $600 lumber. That swaps to a cash flow situation... that's good for $120/MFBM margins. So, what's that $600M worth? Probably more than 3x today... at least 6x. You'll see So, the IFP spike eventually.
But RFP? It's got 440 MW of power, worth a billion. A million ish tons of pulp? That's $2B to replace and hammering out cash. So, say half IFP's value on 2x4s but toss in another few (well, 3) billion on top. That's what you're missing. They're also a comeback story given the pension shortfall that just went way with rates. They have been led poorly for a long time... entre Uncle Duncan of IFP fame. It's again a positive catalyst.
So IFP is sound and one dimensional... but the hoodrat name made good is gonna see more spikes. Like RFP. Moreover, the sum of parts is higher than IFP.
So, the notion of differential fundamentals is highly dubious.
Last of all RFP has the 91% ownership intuitionally with more in funds. It's very locked up. Yet, some clowns wound up with 2.7 million shares short. They're getting their faces ripped off (as they should). IFP has less short interest and less concentration so it's less likely to rocket when the reaper comes for the 22-year-old jr analyst who found a nice high beta commodity "revert to the mean" name to short. Yikkkesss.