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Investing In European Cardboard With Mayr-Melnhof Karton: A Family Company With A Strong Dividend Record

Published Wed, 04 Jul 2018 09:25:00 -0400 on Seeking Alpha

The paper and cardboard industry seems to be ready for some consolidation as we have seen attempts from International Paper (IP) to acquire the Ireland-based Smurfit Kappa Group (OTCPK: SMFKY) (OTCPK: SMFTF), whilst more recently, Hong Kong's Nine Dragons Paper acquired a Canadian paper mill. On top of that, DS Smith (OTC:DSSMY) (OTC:DITHF) is raising the funds to acquire Spanish competitor Papeles y Cartones de Europa for almost 2B EUR.
The increased level of M&A activity could also put some smaller (and more specialized) companies in the spotlights, and Austria appears to have a hidden gem with Mayr-Melnhof Karton (OTCPK: MNHFY) (OTC:MNHFF), which I will abbreviate as "MM Karton" for simplicity sake. This is a family-owned company, as the Mayr-Melnhof family owns almost 60% of the company's share count.

Source: finanzen.net
Although the company does have an American and German listing, it's highly recommended to use its main listing on the Vienna Stock Exchange due to the better liquidity on its home market. The average daily volume is 3,300 shares, for a dollar volume of approximately US$450,000. The company has exactly 20 million shares outstanding, and the current share price of 115.60 EUR results in a market capitalization of 2.3B EUR. The ticker symbol in Vienna is MMK.
MM Karton is off to a good start in 2018 Let's first have a quick look at MMK's performance in the first quarter of this year, before I explain the... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
INTERNATIONAL PAPER 42.50   10.2 4.17 2.00 4.69


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