Verso Paper initiated at outperform, $12 price target by Credit Suisse

BOSTON, Jun 25, 2008 (Thomson Financial via COMTEX) -- VRS | Quote | Chart | News | PowerRating -- Verso Paper Corp. was Wednesday initiated with an outperform rating and $12 price target at Credit Suisse, which said the risk and reward balance is highly attractive given the issue's current valuation and that coated paper is one of the very few grades worth watching right now.

"Coated (paper) is a more secular than cyclical story in our view," Credit Suisse said in a note to clients. "The historic pattern of high gross domestic product sensitivity hasn't been evident in the past few years, and we expect that to be true in a recession too."

Credit Suisse said the coated markets are already behaving better and Verso has hit the ground running with no merger integration, no "crummy" mills and a mix weighted to groundwood and roll business.

Shares of the Memphis, Tenn.-based coated papers manufacturer closed Tuesday at $8.38. Greg Saulnier gs/vj

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