Goldman Sachs Reiterates Buy Rating On MeadWestvaco

According to Goldman Sachs, MeadWestvaco (NYSE: MWV) announced that it will invest $285 mn to build a new biomass boiler and upgrade associated power infrastructure at its Covington, VA, mill.

Goldman Sachs said that the Covington mill produces about 800,000 tons of solid bleached sulfate (SBS) paper per annum. MWV will replace two older boilers with a new biomass boiler (i.e., it can burn tree bark) and related 75 megawatt steam turbine generator. “We reiterate our Buy rating (CL) on MWV, given its leverage to our constructive view of US boxboard fundamentals, and portfolio of land in the US South which we believe is not reflected in valuation.”

MeadWestvaco closed yesterday at $32.23.