Stephanie Grimmett in Today’s Financial News says it could be time to get into the paper market. A new accord for containerboard prices could mean earnings triple at Smurfit-Stone Container Corp. (NASDAQ:SSCC). This stock has already spiked 23% in one day. Stephanie says buying SSCC at below $6 could mean 30% gains over the next six months.

I’m trying to forget Laura Cadden’s last foray into the paper market. Her Nine Dragons Paper Holdings (Hong Kong: 2689) ended badly, to say the least.

It was a thriving company in a growing sector (paper recycling). The company was, and is, an ambitious, fast-growing paper recycler that bought America’s trash just to sell it back to us again as new packaging.

The only problem with the stock pick was a little thing called slave labor. A few months after buying into Nine Dragons, some college students in Hong Kong published an article accusing the paper recycler and five other companies of unfair labor practices and human rights violations.

The government, instead of repeating what it says to Amnesty International every time it executes a journalist (which would be something like: “What? They have the right to die silently or with wails and screams. That’s way more than we used to give them.”), actually investigated the claims against Nine Dragons (the Chinese government equivalent of telling companies to stop horning in on its exclusive rights to ignore human rights).

But now, we’ve found an American company (you know, the kind with a union to prevent pesky things like slave labor) that could triple its profits in the next year.

Smurfit-Stone Container Corp.is up 23% today on news that its competitor International Paper (NYSE:IP) pushed through a hike in containerboard prices as of October 1.

The new prices, which aren’t specified, could triple Smurfit’s earnings if they hold through 2009. That would mean earnings as high as $1.50 per share versus the estimated 45 cents per share right now.

And even after Smurfit’s 23% run up today, the share price would only be about four times earnings.As of the end of July, containerboard inventories (measured in tons) were at their lowest since the 1980s. And Hurricane Gustav is expected to cut production by another 30,000 tons.Perhaps now is the time to jump into the paper market.

Buy Smurfit-Stone Container Corp. when it falls below $6 and hold for gains of at least 30% in the next six months.

Source: Buy Smurfit-Stone When It Falls Below $6