Buckeye Technologies' (NYSE:BKI) Pricing Position Remains Weak

The ability of Buckeye Technologies (NYSE:BKI) to command a premium price for their products is no longer there, although they seem to be able to increase their wood specialty price for 2011 from 6.5 percent to 13 percent.

UBS (NYSE:UBS) says, "Dissolving pulp markets were surprisingly-strong going into annual price negotiations. We recently raised our price assumption (and BKI EPS estimates) for assumed 13% wood specialty price recovery in calendar 2011. Our prior forecast was +6.5%. Putting this in perspective, 13% growth would still leave BKI’s high-end specialty prices well below spot prices for low-end textile grades. Normally BKI’s more demanding products would command a premium."

UBS reiterates a "Buy" rating on Buckeye Technologies, which closed Wednesday at $21.99, up $0.62, or 2.90 percent. UBS raised their price target on Buckeye Technologies from $22 to $25.