Sylvamo Corp: Sell Rating Maintained Amid Unsustainable Gains and Cautious Financial Outlook

In a report released yesterday, George Staphos from Bank of America Securities reiterated a Sell rating on Sylvamo Corp (SLVM – Research Report), with a price target of $86.00.

George Staphos has given his Sell rating due to a combination of factors impacting Sylvamo Corp. The company’s recent quarterly performance was largely in line with expectations, but was bolstered by one-time gains, which may not be sustainable moving forward. Additionally, Sylvamo’s guidance for the first quarter fell short of market expectations, reflecting potential challenges in the upcoming year, particularly due to anticipated losses in Europe and flat earnings projections when compared to 2024.
Moreover, Sylvamo is expecting increased maintenance costs and lower pricing in early 2025, driven by European market price reductions and export weaknesses in Latin America. While the company is optimistic about its long-term projects and initiatives, such as the investment in the Eastover mill, the immediate financial outlook remains cautious. This cautious outlook and the need to adjust earnings estimates downward for the coming years have led Staphos to maintain a Sell rating on Sylvamo’s stock.

SLVM’s price has also changed slightly for the past six months – from $75.230 to $71.800, which is a -4.56% drop .