Sylvamo (NYSE:SLVM) Issues Earnings Results

Sylvamo (NYSE:SLVM) released its earnings results on Friday. The company reported $0.03 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.02 by $0.01, FiscalAI reports. Sylvamo had a net margin of 3.11% and a return on equity of 9.79%. The company had revenue of $806.00 million for the quarter, compared to analyst estimates of $811.25 million. During the same period in the prior year, the business earned $0.37 EPS. The firm’s quarterly revenue was up 1.5% on a year-over-year basis.

Here are the key takeaways from Sylvamo’s conference call:

• Adjusted EBITDA more than doubled sequentially to $60 million in Q2, driven primarily by paper price increases, improved mix, lower operating costs, and European green-energy credits.
• Management expects a stronger second half, including a projected $75 million-$85 million improvement in price and mix versus the first half, seasonally stronger Latin American demand, lower fiber costs, and the reversal of much of the working-capital build.
• North American volumes are expected to decline in the second half because of the Riverdale supply loss, an Eastover outage extending beyond the planned 45 days, and reduced imports from Brazil following tariff changes.
• Eastover investments remain on schedule and on budget, with the paper-machine speed-up and new sheeter expected to deliver approximately $50 million in annual benefits; including the warehouse expansion, the projects are expected to generate about $55 million annually.
• European operations continue to face difficult industry conditions and unacceptable margins. Although cost and mix improvements are underway, management said it may consider alternatives such as further investment, closure, or a sale if the outlook is not satisfactory, potentially in 2027.

Sylvamo Stock Up 8.6%

Shares of Sylvamo stock traded up $3.26 during trading on Friday, hitting $41.04. 405,522 shares of the stock were exchanged, compared to its average volume of 286,172. The stock has a market cap of $1.63 billion, a price-to-earnings ratio of 16.22, a price-to-earnings-growth ratio of 0.93 and a beta of 0.87. The firm’s 50-day moving average price is $38.85 and its 200 day moving average price is $42.22. Sylvamo has a 12-month low of $35.53 and a 12-month high of $56.80. The company has a debt-to-equity ratio of 0.78, a current ratio of 1.45 and a quick ratio of 0.81.

Sylvamo Dividend Announcement

The company also recently disclosed a quarterly dividend, which was paid on Tuesday, July 28th. Stockholders of record on Tuesday, July 7th were issued a $0.45 dividend. This represents a $1.80 dividend on an annualized basis and a dividend yield of 4.4%. The ex-dividend date was Tuesday, July 7th. Sylvamo’s dividend payout ratio (DPR) is presently 71.15%.

Analysts Set New Price Targets

Several analysts have recently issued reports on SLVM shares. Zacks Research cut Sylvamo from a “hold” rating to a “strong sell” rating in a research note on Tuesday, July 14th. Weiss Ratings cut Sylvamo from a “hold (c-)” rating to a “sell (d+)” rating in a research note on Monday, May 11th. Royal Bank Of Canada cut their price target on Sylvamo from $49.00 to $46.00 and set a “sector perform” rating on the stock in a report on Friday, July 17th. Truist Financial reduced their price target on Sylvamo from $54.00 to $51.00 and set a “buy” rating on the stock in a research report on Wednesday, July 15th. Finally, Wall Street Zen upgraded Sylvamo from a “sell” rating to a “hold” rating in a research note on Sunday, August 2nd. One research analyst has rated the stock with a Buy rating, two have issued a Hold rating and two have assigned a Sell rating to the company’s stock. According to data from MarketBeat, the stock currently has a consensus rating of “Reduce” and an average price target of $47.33.

Insider Activity at Sylvamo

In related news, Director Lizanne M. Bruce sold 1,230 shares of the stock in a transaction on Monday, June 15th. The stock was sold at an average price of $41.70, for a total value of $51,291.00. Following the transaction, the director owned 14,475 shares of the company’s stock, valued at $603,607.50. This represents a 7.83% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available through this hyperlink. Insiders own 0.81% of the company’s stock.

Institutional Trading of Sylvamo

A number of institutional investors have recently bought and sold shares of the business. UMB Bank n.a. boosted its position in shares of Sylvamo by 171.2% during the 4th quarter. UMB Bank n.a. now owns 564 shares of the company’s stock worth $27,000 after acquiring an additional 356 shares in the last quarter. Advisory Services Network LLC acquired a new stake in shares of Sylvamo during the 3rd quarter worth about $38,000. EverSource Wealth Advisors LLC lifted its stake in Sylvamo by 185.5% during the second quarter. EverSource Wealth Advisors LLC now owns 982 shares of the company’s stock worth $49,000 after purchasing an additional 638 shares during the last quarter. Smartleaf Asset Management LLC lifted its stake in Sylvamo by 83.2% during the fourth quarter. Smartleaf Asset Management LLC now owns 1,275 shares of the company’s stock worth $62,000 after purchasing an additional 579 shares during the last quarter. Finally, Virtus Investment Advisers LLC acquired a new position in Sylvamo in the fourth quarter valued at approximately $160,000. 91.16% of the stock is owned by hedge funds and other institutional investors.

Sylvamo Company Profile

Sylvamo Corporation, trading on the New York Stock Exchange under the ticker SLVM, is a leading global producer of uncoated freesheet paper. The company was established in October 2021 through a spin-off from International Paper, creating an independent entity focused exclusively on the development, manufacturing and marketing of high-quality uncoated paper products. Headquartered in Memphis, Tennessee, Sylvamo draws on decades of industry experience inherited from its predecessor, positioning itself to meet evolving customer needs in paper-based communications and packaging applications.

The company’s core product portfolio includes office and digital print papers, direct mail and marketing materials, catalog and commercial printing papers, and a range of specialty and value-added grades.