Orchids Paper employs about 300 people. The 2009-10 construction of a new warehouse and a second converter line — where consumer products are made from the huge parent rolls — allowed the company to expand into higher-level segments of the private label market.
Stock analyst John Nobile with Taglich Brothers Inc., a New York City brokerage that helped launch Orchid Paper's initial public offering in 2005, considers TIS a “speculative buy.”
Forecast growth in the discount retail and dollar store segment of the economy could leave Orchids Products sitting pretty, even though the company does not have supply contracts with its customers, but operates by purchase orders, Nobile suggested in a recent report.
“Because Orchids products are daily consumable items, order streams are fairly consistent with no significant seasonal fluctuations. Changes in the national economy do not materially affect the market for Orchids' products,” he said.
Nobile, citing a report in Tissue World Magazine, also noted that “private label growth in the American tissue market has been steady. More and more consumers now prefer private labels as an alternative to more expensive branded products.”
Or, as Snyder put it in an interview with The Oklahoman: “We're in the business of producing a product — paper towels, tissue, napkins — that people use every day. The tissue business is more about population than the economy. As the population increases, the need for tissue products increases.”
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