Sylvamo Corp (SLVM) stock analysis

P/E against its history

Not enough price and earnings history to compare.

P/E against the industry

Needs positive earnings and enough profitable companies in the industry.

EV/EBITDA against its history

Needs positive EBITDA and price history.

P/B above the industry

Sylvamo's price-to-book of 2.08 is above the Paper and Allied Products median of 1.46.

Trading below fair value

The share price of $38.78 is below our fair value estimate of $60.17.

Margin of safety over 20%

The price is 35.5% below fair value, more than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew -2.6% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew 6.8% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew -200% over the last twelve months, against a 5-year average of -4.9% a year.

Growing faster than the industry

Revenue grew 12.4% over the last twelve months; the Paper and Allied Products median is 0.8%.

Guidance issued

The latest outlook (2026 North America footprint transition costs reduction, May 8, 2026) was issued for the first time, so it neither adds nor takes away points.

Gross margin slipping

Gross margin was 17.8% over the last twelve months, against 23.7% a year earlier.

Return on equity under 15%

Return on equity was -21.0% over the last twelve months and averaged 27.5% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 4.8%, below the 10% that usually covers the cost of capital.

Return on equity below the industry

Sylvamo's return on equity of -21.0% is below the Paper and Allied Products median of 0.3%.

Earnings shrank over 5 years

Net income shrank 4.9% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was -4.9% over the last twelve months, against a 5-year average of 6.7%.

Net margin below the industry

Sylvamo's net margin of -4.9% is below the Paper and Allied Products median of 0.2%.

High debt

Debt is 122% of shareholders' equity, above the 40% we consider low.

Debt rising against equity

Debt to equity rose from 1.0% five years ago to 122%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 20.7% of total debt.

Interest not well covered

Operating income covers interest expense 1.7 times; we look for at least 5.

Short-term assets cover short-term debts

Current assets are 1.29 times current liabilities.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.96; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Sylvamo paid dividends worth 4.6% of the share price over the last twelve months.

Yield above Treasuries

The 4.6% yield is above the 4.4% on a 1-year Treasury.

Yield in the top quarter

The top quarter of US dividend payers yield 3.8% or more; Sylvamo yields 4.6%.

Dividend stability

Fewer than five years of dividend history.

Earnings cover

Needs dividends paid and net income.

Cash-flow cover

Needs dividends paid and free cash flow.