Sure, if your terminal value only extends out one year....

Sure, if your terminal value only extends out one year. Extrapolate a 10% earnings decline out a couple of years and the current price will start to look expensive.

I think the concern over SWM is whether it's facing major structural changes which will change the whole media environment forever. There's uncertainty around what SWM will look like in 5-10 years time.

For what it's worth, I too think SWM's looking pretty cheap (I've posted my thoughts on it, and also my reason for getting out a few months ago), but I also think there's a reasonable chance earnings will continue to decline, so it's a bit too risky for me to purchase.