Resolute Forest (RFP) nice looking small cap breakout and 1250 July $15 puts selling to open for $1.30, name with 11,250 January $15 calls in OI form a 1/27 buyer at $2. The RFP weekly chart also looks great in a one-year coiled consolidation range. RFP a name we featured in March noting:

“The $955M company trades 4.5X earnings, 0.26X sales, and 8X cash. RFP is a forest products company with exposure to pulp, tissue, wood products and paper production and the leading Canadian producer of wood products east of the Rockies. They have exposure to products like newsprint, books, and mailers as well as, consumer products, lumber and more. RFP is benefitting from higher lumber prices which have more than doubled off the August lows. RFP has been shifting more focus towards wood products and pulp as demand for paper wanes and they see a significant opportunity to capitalize on housing demand with plenty of high-return projects in the pipeline. They have some of the largest-scale and capital-efficient operations in the region as well as significant harvesting rights in Canada that position them well to be a leader in the coming years. RFP has also been deleveraging the balance sheet and could pursue M&A to build out those higher-growth businesses. Analysts have an average target for shares of $17.25 with a Street High $19. CIBC upgrading recently to Outperformer citing a forecast for significant free cash flow generation in a stronger lumber market. Scotiabank positive on the name recently, as well, noting that the outlook for the U.S. housing market remains supportive of elevated oriented strand board and lumber demand which will give RFP better pricing power in 2022. Short interest is 2.5%. Hedge fund ownership  fell modestly. Point72 a new buyer of stock. Insiders have been active in the name recently too including a director buying 13,300 shares in mid-February at $11.80 to $15. “