Sylvamo (NYSE:SLVM) Posts Earnings Results, Beats Expectations By $0.01 EPS

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

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 NYSE:SLVM traded up $3.26 during trading hours on Friday, reaching $41.04. The stock had a trading volume of 405,522 shares, compared to its average volume of 286,172. Sylvamo has a 1 year low of $35.53 and a 1 year high of $56.80. The firm’s 50 day moving average is $38.85 and its 200-day moving average is $42.22. The company has a debt-to-equity ratio of 0.78, a quick ratio of 0.81 and a current ratio of 1.45. The stock has a market capitalization of $1.63 billion, a price-to-earnings ratio of 16.22, a P/E/G ratio of 0.93 and a beta of 0.87.

Sylvamo Dividend Announcement

The company also recently declared a quarterly dividend, which was paid on Tuesday, July 28th. Shareholders of record on Tuesday, July 7th were issued a dividend of $0.45 per share. This represents a $1.80 annualized dividend and a yield of 4.4%. The ex-dividend date was Tuesday, July 7th. Sylvamo’s payout ratio is 71.15%.

Analysts Set New Price Targets

A number of brokerages have issued reports on SLVM. Royal Bank Of Canada cut their target price on Sylvamo from $49.00 to $46.00 and set a “sector perform” rating on the stock in a research report on Friday, July 17th. Bank of America reaffirmed a “neutral” rating and issued a $45.00 price objective on shares of Sylvamo in a research note on Tuesday, July 14th. Zacks Research downgraded Sylvamo from a “hold” rating to a “strong sell” rating in a report on Tuesday, July 14th. Wall Street Zen raised Sylvamo from a “sell” rating to a “hold” rating in a research note on Sunday, August 2nd. Finally, Truist Financial lowered their target price on Sylvamo from $54.00 to $51.00 and set a “buy” rating for the company in a report on Wednesday, July 15th. One investment analyst has rated the stock with a Buy rating, two have issued a Hold rating and two have given a Sell rating to the company’s stock. Based on data from MarketBeat.com, the company has a consensus rating of “Reduce” and an average price target of $47.33.

Insider Activity

In other news, Director Lizanne M. Bruce sold 1,230 shares of Sylvamo stock in a transaction on Monday, June 15th. The shares were sold at an average price of $41.70, for a total transaction of $51,291.00. Following the completion of the sale, the director directly owned 14,475 shares of the company’s stock, valued at approximately $603,607.50. The trade was a 7.83% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. Company 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 SLVM. UMB Bank n.a. raised 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 position in Sylvamo in the third quarter valued at approximately $38,000. EverSource Wealth Advisors LLC increased its stake in Sylvamo by 185.5% in the second quarter. EverSource Wealth Advisors LLC now owns 982 shares of the company’s stock valued at $49,000 after purchasing an additional 638 shares during the last quarter. Smartleaf Asset Management LLC increased its stake in Sylvamo by 83.2% in the fourth quarter. Smartleaf Asset Management LLC now owns 1,275 shares of the company’s stock valued at $62,000 after purchasing an additional 579 shares during the last quarter. Finally, Virtus Investment Advisers LLC acquired a new stake in Sylvamo during the fourth quarter worth 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.