Shares of corrugated box maker International Paper (IP) are outperforming broader market measures after being upgraded to buy on eCommerce drivers.

E-COMMERCE GROWTH: Goldman Sachs’ analyst Brian Maguire added to the growing list of bullish analyst commentary on International Paper in a research note, after a “deep-dive” into the implications of eCommerce on packaging stocks. eCommerce is becoming a larger part of International Paper’s base business, growing at a 15% rate. Maguire, who sees box demand growing at a 2%-3% rate due to eCommerce, upgraded International Paper to Buy from Neutral and raised his price target by $4, to $64. “eCommerce is now a significant portion of containerboard demand and is growing fast enough that we are no longer very concerned with demand undercutting supply growth,” said Maguire, in a separate note on the container board sector. Incremental container board pricing and $50 a ton in potentially more pricing are not being considered by other firms in Street estimates, added Maguire.

IP SEES STRONG SECOND HALF: Back in April, International Paper reported first quarter financial results that beat on the top and bottom lines, attributing the growth in revenue to to the pulp business that was acquired in late 2016. “International Paper delivered a solid first quarter in the face of several challenges, including the digester incident at our Pensacola mill and higher input costs driven by a significant rise in OCC prices. Given the market fundamentals across most of our businesses in combination with several IP commercial and operational initiatives, we expect improved results pointing to a particularly strong second half as well as positive momentum entering 2018. I remain very confident in IP’s ability to generate significant year-over-year earnings growth and continued strong cash flow in 2017,” said CEO Mark Sutton, after its Q1 results.

COULD BE UP 25% BY YEAR-END: Following its Q1 report in April, Barron’s said the company offers “plenty to entice investors,” including rising free cash flow and a steadily growing dividend, Barron’s contented in a feature article. The packaging and paper name is a beneficiary of ecommerce trends, and could return 25% by year end as volumes rebound and the company hikes prices, the publication said. “We are at an inflection point. We expect margins to return to peak levels at the end of this year. In industrial packaging, we will exit the year in the 23% to 25% range, compared with trough margins in the first quarter of 18.5%,” CFO Glenn Landau told the publication in an interview.