Clearwater Paper (NYSE:CLW) Issues Quarterly Earnings Results, Misses Expectations By $0.26 EPS

Key Points

• Clearwater Paper missed quarterly earnings expectations: The company reported a loss of $1.75 per share versus the $1.49 consensus estimate, alongside a $21 million net loss and negative $8 million of adjusted EBITDA.
• Industry conditions and pricing may improve: Stronger SBS shipments, lower imports and reduced production are supporting the market, while two planned $60-per-ton price increases could generate a $50 million–$60 million annualized EBITDA benefit beginning in the second half of 2026.
• Near-term costs remain a concern, but management is pursuing savings: The Iran conflict is expected to increase third-quarter costs by $3 million–$5 million and reduce full-year results by roughly $20 million–$25 million, partly offset by restructuring savings, debt reduction and planned positive free cash flow in 2026.

Clearwater Paper (NYSE:CLW - Get Free Report) released its earnings results on Tuesday. The basic materials company reported ($1.75) earnings per share (EPS) for the quarter, missing analysts' consensus estimates of ($1.49) by ($0.26), Zacks reports. Clearwater Paper had a negative net margin of 1.63% and a negative return on equity of 3.94%.

Here are the key takeaways from Clearwater Paper's conference call:

• Second-quarter profitability remained weak: Clearwater Paper reported a $21 million net loss and negative $8 million of adjusted EBITDA, as an 8% shipment increase was more than offset by a 9% decline in market pricing and higher outage, transportation, and chemical costs.
• SBS industry conditions are improving. The company cited 6% year-to-date industry shipment growth, an 11% decline in imports, reduced industry production, and operating rates expected to exceed 90% by year-end.
• Two planned $60-per-ton price increases are expected to begin benefiting results in the second half of 2026; the first increase and related index changes are expected to provide a $50 million-$60 million annualized EBITDA benefit, with a larger impact expected in 2027.
• The Iran conflict is expected to raise chemical and transportation costs by an additional $3 million-$5 million in the third quarter and negatively affect full-year results by approximately $20 million-$25 million.
• Cost reductions and balance-sheet actions continue: the Cypress Bend restructuring is expected to save $8 million-$12 million annually, net debt fell $59 million in the quarter, and management expects positive free cash flow for 2026 while pursuing refinancing ahead of facility maturities.

Clearwater Paper Stock Performance

Shares of CLW traded up $0.34 on Tuesday, reaching $17.56. 202,904 shares of the stock traded hands, compared to its average volume of 211,082. The firm has a market cap of $283.15 million, a price-to-earnings ratio of -11.40 and a beta of 0.27. The company has a debt-to-equity ratio of 0.44, a current ratio of 2.61 and a quick ratio of 1.26. Clearwater Paper has a 12 month low of $11.73 and a 12 month high of $30.02. The stock's 50-day moving average price is $15.96 and its 200-day moving average price is $15.74.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently bought and sold shares of the company. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. boosted its stake in Clearwater Paper by 4.2% during the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 9,629 shares of the basic materials company's stock worth $244,000 after buying an additional 390 shares in the last quarter. Tower Research Capital LLC TRC raised its stake in shares of Clearwater Paper by 34.7% in the 2nd quarter. Tower Research Capital LLC TRC now owns 2,185 shares of the basic materials company's stock valued at $60,000 after buying an additional 563 shares in the last quarter. Verition Fund Management LLC raised its stake in shares of Clearwater Paper by 4.1% in the 4th quarter. Verition Fund Management LLC now owns 15,900 shares of the basic materials company's stock valued at $277,000 after buying an additional 631 shares in the last quarter. Deutsche Bank AG lifted its holdings in shares of Clearwater Paper by 7.0% during the 4th quarter. Deutsche Bank AG now owns 12,319 shares of the basic materials company's stock worth $214,000 after acquiring an additional 802 shares during the period. Finally, Turtle Creek Asset Management Inc. lifted its holdings in shares of Clearwater Paper by 14.0% during the 3rd quarter. Turtle Creek Asset Management Inc. now owns 12,200 shares of the basic materials company's stock worth $253,000 after acquiring an additional 1,500 shares during the period. 89.98% of the stock is owned by institutional investors.

Analysts Set New Price Targets

CLW has been the subject of a number of research analyst reports. Truist Financial upped their price target on Clearwater Paper from $12.00 to $17.00 and gave the stock a "hold" rating in a report on Wednesday, July 15th. Zacks Research upgraded shares of Clearwater Paper to a "hold" rating in a research note on Monday, July 6th. TD Securities lowered shares of Clearwater Paper from a "strong-buy" rating to a "hold" rating in a research report on Wednesday, April 29th. Bank of America began coverage on shares of Clearwater Paper in a research note on Thursday, July 2nd. They set a "buy" rating and a $19.00 target price for the company. Finally, Wall Street Zen downgraded shares of Clearwater Paper from a "hold" rating to a "sell" rating in a report on Sunday, June 28th. Two analysts have rated the stock with a Buy rating, five have assigned a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat, Clearwater Paper currently has a consensus rating of "Hold" and a consensus target price of $18.17.

About Clearwater Paper

Clearwater Paper Corporation is an independent manufacturer of premium tissue and pulp and paperboard products for private-label and commercial customers in North America. The company operates through two core segments: Consumer Products, which produces bathroom tissue, paper towels and other away-from-home tissue products under private-label contracts; and Pulp & Paperboard, which supplies bleached paperboard used in folding cartons, foodservice packaging and specialty paper applications.

The Consumer Products segment services retail grocers, warehouse clubs, online merchants and janitorial distributors, leveraging multiple converting facilities to produce roll and folded tissue items for both household and institutional use.

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