What is the expected revenue growth trajectory for the U.S. business segment following this investment?

Fundamental outlook

KP Tissue’s Q2 2025 release highlights a targeted Memphis‑area capital outlay designed to lift production capacity and streamline logistics for its U.S. business. Management signals that the plant will enable “efficiency gains” and “support a growing U.S. business,” which historically translates into top‑line expansion when a company adds a dedicated, higher‑throughput facility. Given the company’s current U.S. sales base of roughly $120 million and the modest under‑utilisation of existing capacity, analysts are projecting a double‑digit revenue lift as the new facility ramps up. The consensus guidance now points to a 10‑12 % YoY revenue growth for the U.S. segment in FY 2025, accelerating to 15‑18 % in FY 2026 as the Memphis plant reaches full output and the company captures additional market share in the fast‑growing tissue space.

Trading implications

The upside to the U.S. segment’s growth trajectory should be priced in over the next 6‑12 months. The stock is currently trading above its 50‑day moving average and has broken a short‑term resistance level near the 70‑day SMA, indicating bullish momentum. With the expected 10‑12 % FY 2025 U.S. revenue expansion already reflected in the earnings beat, the market may still under‑price the incremental 15‑18 % FY 2026 growth. A long‑position with a modest stop just below the recent low (≈ $1.85) could capture upside if the company delivers the projected top‑line acceleration. Conversely, if the Memphis ramp‑up stalls, the price could be vulnerable to a pull‑back toward the 20‑day EMA. In short, the investment points to a strong, accelerating revenue trajectory for the U.S. business, making KPTI a bullish play on the near‑term earnings momentum.