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Suzano Papel E Celulose (SUZ)
NYSE:SUZ
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Suzano Papel e Celulose SA
(NYSE:SUZ)
Rating:61Neutral
Price Target:
$10.00
▲(4.93%Upside)
Positive Factors
Cost Leadership
Suzano continues to strengthen its position as a global cost leader in pulp production by addressing structural challenges through innovative strategies.
Financial Performance
Suzano reported 3Q24 EBITDA at R$6.5bn, 6% above consensus, driven by stronger pulp shipments and higher paper shipments.
Valuation
Suzano is trading at an attractive valuation compared to its historical EV/EBITDA, offering a potential investment opportunity.
Negative Factors
Supply and Demand
The company’s outlook for S&D indicates that supply should outpace demand by 2028 – likely triggering pulp price pressure to balance out markets.
Suzano Papel e Celulose SA (SUZ) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$11.73B
Dividend Yield2.9%
Average Volume (3M)1.81M
Price to Earnings (P/E)15.7
Beta (1Y)0.31
Revenue Growth14.78%
EPS Growth-111.06%
CountryUS
Employees35,000
SectorBasic Materials
Sector Strength73
IndustryPaper, Lumber & Forest Products
Share Statistics
EPS (TTM)0.92
Shares Outstanding1,264,117,700
10 Day Avg. Volume1,302,976
30 Day Avg. Volume1,805,954
Financial Highlights & Ratios
PEG Ratio0.02
Price to Book (P/B)1.97
Price to Sales (P/S)0.00
P/FCF Ratio9.55
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$18.00Price Target Upside88.88% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Suzano Papel e Celulose SA Business Overview & Revenue Model
Company DescriptionSuzano Papel e Celulose SA (SUZ) is one of the largest pulp and paper producers in the world, based in Brazil. The company operates in the forestry, pulp, and paper industries, focusing on the manufacture of eucalyptus pulp and a wide range of paper products. Suzano is known for its integrated business model that encompasses the entire production chain, from planting and cultivating eucalyptus trees to processing pulp and producing paper. The company prioritizes sustainable practices and technological innovation to maintain its leadership in the industry.
How the Company Makes MoneySuzano makes money primarily through the production and sale of pulp and paper products. The company's revenue streams include the sale of eucalyptus pulp, which is supplied to paper manufacturers globally, and the production of paper products such as printing and writing paper, packaging, and tissue paper. Suzano's integrated operations allow it to control costs effectively and ensure a consistent supply of raw materials. Additionally, the company benefits from significant economies of scale due to its extensive forestry operations and large-scale production facilities. Strategic partnerships and long-term contracts with major clients worldwide also contribute to its revenue stability and growth. Suzano's commitment to sustainable practices and innovation helps it maintain a competitive edge in the global market.
Suzano Papel e Celulose SA Earnings Call Summary
Earnings Call Date:May 09, 2025
(Q1-2025)
| % Change Since: 6.12%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted Suzano's strategic focus on deleveraging and improving operational efficiency amidst global market uncertainties. While there were notable improvements in packaging performance and sales volume growth, challenges in the pulp market and increased costs due to maintenance impacted overall results.Q1-2025 Updates
Positive Updates
Sales Volume Growth and Price Increases
Suzano achieved sales volume growth on a year-over-year basis with improvements in Suzano packaging operations. Increases in pricing were noted in both Brazilian and American operations, contributing to higher net prices.
Strong Packaging Performance
Suzano packaging saw a 62% increase in sales volume quarter-over-quarter and a 67% improvement in EBITDA, indicating a successful turnaround strategy.
Cash Cost Management
Cash production cost excluding downtimes increased by 6% as expected, mainly due to maintenance downtimes, but a reduction is anticipated for the coming quarters.
Deleveraging Focus
Suzano remains committed to deleveraging, maintaining a leverage of 3 times net debt to EBITDA, and achieved a competitive cost of capital during the quarter.
Negative Updates
Pulp Market Uncertainty
The pulp market faced challenges with declining order intake in Asia and uncertainty due to global trade tensions affecting customer sentiment.
Higher Costs in Brazilian Operations
Higher costs were reported due to annual maintenance downtimes, impacting the financial results of Brazilian operations.
International Market Pressure
International paper and pulp markets continued to be oversupplied, with price pressures due to ongoing trade discussions and tariffs affecting market dynamics.
Increased Net Debt
Net debt increased slightly to $12.9 billion by the end of the quarter, with a small uptick in leverage from 2.9 times to 3 times net debt to EBITDA.
Company Guidance
During the first quarter of 2025, Suzano's financial guidance indicated that several key metrics aligned with management's expectations. The company successfully rebuilt its inventory to normalized levels despite the concentration of maintenance downtimes. Pulp and paper invoicing prices, cash cost performance, capital expenditures (CapEx), and main balance sheet metrics met management's forecasts. Suzano emphasized its ability to generate free cash flow under any pulp price scenario due to its resilient business model, while also aiming to further reduce cash costs, SG&A, and CapEx per ton. Additionally, the company maintained its focus on deleveraging and enhancing its competitive position amid an unpredictable global landscape, ensuring financial strength and operational efficiency.Suzano Papel e Celulose SA Financial Statement Overview
Summary
Suzano Papel e Celulose SA shows strong operational efficiency and cash flow generation. However, it faces significant challenges with profitability due to a substantial net loss in 2024 and high leverage, which poses financial risks. Despite impressive revenue growth, the high debt-to-equity ratio and reduced stockholders' equity highlight potential instability.Income Statement
The company shows volatility in net income, with a significant net loss in 2024 compared to a high net income in 2023. Revenue growth from 2023 to 2024 is strong at 19.21%, but this is overshadowed by a negative net profit margin due to the net loss. The gross profit margin is stable, and both EBIT and EBITDA margins remain robust, indicating operational efficiency despite the net loss.60
Neutral
Balance Sheet
The balance sheet reflects a high debt-to-equity ratio, indicating significant leverage, which poses financial risk. Stockholders' equity has decreased, and the equity ratio is relatively low, highlighting potential instability. However, the company maintains substantial cash reserves, which provide some liquidity cushion.50
Neutral
Cash Flow
Operating cash flow is strong and shows growth, but free cash flow has improved notably from negative in 2023 to positive in 2024. The company effectively converts operating cash flow into free cash flow, though the free cash flow to net income ratio is impacted by the net loss.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 37.94B | 47.40B | 39.76B | 49.83B | 40.97B | 30.46B |
| Gross Profit | 16.08B | 20.00B | 14.68B | 25.01B | 20.35B | 11.49B |
| EBITDA | 21.75B | 23.46B | 29.40B | 30.63B | 24.62B | 12.23B |
| Net Income | -7.29B | -7.07B | 14.08B | 23.38B | 8.63B | -10.71B |
Balance Sheet | ||||||
| Total Assets | 155.24B | 165.94B | 143.59B | 133.20B | 118.98B | 101.80B |
| Cash, Cash Equivalents and Short-Term Investments | 16.43B | 21.99B | 21.17B | 17.05B | 21.10B | 9.05B |
| Total Debt | 97.89B | 108.41B | 83.42B | 80.76B | 85.52B | 78.09B |
| Total Liabilities | 116.71B | 133.52B | 98.78B | 100.03B | 103.80B | 94.46B |
| Stockholders Equity | 38.40B | 32.28B | 44.69B | 33.06B | 15.08B | 7.23B |
Cash Flow | ||||||
| Free Cash Flow | 6.62B | 4.07B | -241.59M | 6.80B | 11.39B | 8.23B |
| Operating Cash Flow | 21.97B | 20.60B | 17.32B | 21.64B | 17.64B | 13.12B |
| Investing Cash Flow | -11.15B | -20.51B | -26.04B | -17.02B | -10.36B | -736.42M |
| Financing Cash Flow | -5.39B | -83.77M | 7.80B | -8.11B | -1.57B | -9.79B |
Suzano Papel e Celulose SA Technical Analysis
Positive
9.53
Price Trends
9.25
Positive
9.37
Positive
9.71
Negative
Market Momentum
0.04
Positive
55.06
Neutral
42.73
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SUZ, the sentiment is Positive. The current price of 9.53 is above the 20-day moving average (MA) of 9.47, above the 50-day MA of 9.25, and below the 200-day MA of 9.71, indicating a neutral trend. The MACD of 0.04 indicates Positive momentum. The RSI at 55.06 is Neutral, neither overbought nor oversold. The STOCH value of 42.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SUZ.
Suzano Papel e Celulose SA Risk Analysis
Suzano Papel e Celulose SA disclosed 45 risk factors in its most recent earnings report. Suzano Papel e Celulose SA reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Suzano Papel e Celulose SA Peers Comparison
Overall Rating
UnderperformOutperform
Sector (43)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $4.42B | 34.43 | 11.87% | 1.56% | 6.30% | 41.01% | |
65 Neutral | $2.16B | 7.76 | 31.83% | 3.40% | 0.11% | 46.54% | |
61 Neutral | $485.23M | 33.74 | -8.15% | ― | -15.03% | -233.06% | |
61 Neutral | $11.73B | 15.71 | -2.72% | 2.90% | 14.78% | -111.06% | |
60 Neutral | $385.71M | 4.60 | -66.90% | 5.67% | -7.46% | -36.14% | |
49 Neutral | $243.41M | ― | -17.96% | 8.24% | -1.37% | 60.42% | |
43 Neutral | AU$1.40B | -6.18 | -40.62% | 4.19% | -4.78% | -42.91% |
* Basic Materials Sector Average
Performance Comparison
SUZ
Suzano Papel e Celulose SA
9.53
-0.23
-2.36%
CLW
Clearwater Paper
29.85
-15.97
-34.85%
MERC
Mercer International
3.73
-3.95
-51.43%
MATV
Mativ Holdings
7.39
-7.87
-51.57%
SXT
Sensient Technologies
105.15
32.64
45.01%
SLVM
Sylvamo Corp
52.77
-12.27
-18.87%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.