International Paper (NYSE:IP) Issues Quarterly Earnings Results, Beats Expectations By $0.08 EPS

Key Points

• International Paper beat earnings expectations: Quarterly EPS was $0.37, exceeding the $0.29 consensus by $0.08, while revenue totaled $6.20 billion versus the $6.28 billion estimate and declined 0.4% year over year.
• Operations improved significantly in the third quarter. Adjusted EBITDA rose to $843 million, with margins expanding nearly 400 basis points sequentially; North America Packaging Solutions EBITDA increased 56% to $663 million.
• The company lowered its full-year outlook because of inflation, higher distribution costs, softer volumes and medical expenses, though it expects fourth-quarter North American adjusted EBITDA of approximately $700 million to $740 million. International Paper also maintained its $0.4625 quarterly dividend, yielding about 5.5%.

International Paper (NYSE:IP - Get Free Report) released its earnings results on Wednesday. The basic materials company reported $0.37 earnings per share for the quarter, topping analysts' consensus estimates of $0.29 by $0.08, FiscalAI reports. The firm had revenue of $6.20 billion during the quarter, compared to the consensus estimate of $6.28 billion. International Paper had a negative return on equity of 1.09% and a negative net margin of 14.20%. The firm's revenue for the quarter was down .4% compared to the same quarter last year. During the same period in the prior year, the firm posted ($0.43) earnings per share.

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

• Third-quarter execution improved materially. Adjusted EBITDA rose to $843 million, margins expanded nearly 400 basis points sequentially to 13.6%, and North America Packaging Solutions EBITDA increased 56% sequentially to $663 million, helped by price realization, mill efficiency, and lower outage-related costs.
• International Paper expects further North American improvement in the fourth quarter, including adjusted EBITDA of approximately $700 million-$740 million. Riverdale’s ramp-up, NORPAC synergies, productivity initiatives, and continued realization of price increases are expected to support results.
• Inflation and weak demand reduced the full-year outlook. The 2026 North America adjusted EBITDA forecast was lowered to $2.27 billion-$2.31 billion due primarily to higher diesel and distribution costs, softer volumes, medical costs, and an accelerated outage, while consumer caution and weakness in agriculture and protein markets are expected to persist into 2027.
• Third-quarter free cash flow was negative $267 million because of maintenance-related payments, legacy DS Smith interest, and an inventory build; management still expects full-year free cash flow of approximately $100 million-$200 million, with a stronger fourth-quarter cash profile as working capital reverses.
• The EMEA separation remains on track, with International Paper evaluating a potential sale while continuing spin-off preparations and expecting to retain roughly a 20% stake if the spin proceeds. EMEA results improved sequentially but remained below expectations amid weak demand and higher energy costs, and the company will no longer provide its prior EMEA financial guidance framework.

International Paper Price Performance

Shares of NYSE IP traded down $0.00 during mid-day trading on Wednesday, reaching $33.38. The company had a trading volume of 5,090,203 shares, compared to its average volume of 6,211,028. The company has a 50-day moving average price of $35.25 and a two-hundred day moving average price of $37.54. The stock has a market cap of $17.68 billion, a PE ratio of -5.11, a P/E/G ratio of 4.38 and a beta of 0.93. The company has a current ratio of 1.10, a quick ratio of 0.84 and a debt-to-equity ratio of 0.57. International Paper has a 1-year low of $29.26 and a 1-year high of $50.25.

International Paper Announces Dividend

The business also recently announced a quarterly dividend, which will be paid on Tuesday, December 15th. Investors of record on Monday, November 16th will be issued a $0.4625 dividend. This represents a $1.85 dividend on an annualized basis and a dividend yield of 5.5%. The ex-dividend date is Monday, November 16th. International Paper's payout ratio is presently -28.37%.

Analysts Set New Price Targets

Several brokerages have recently weighed in on IP. Loop Capital set a $61.00 price objective on International Paper in a report on Tuesday, July 28th. Royal Bank Of Canada lifted their target price on International Paper from $48.00 to $52.00 and gave the stock an "outperform" rating in a report on Friday, July 31st. Truist Financial dropped their price target on shares of International Paper from $49.00 to $41.00 and set a "buy" rating on the stock in a research report on Monday, October 12th. Wall Street Zen downgraded shares of International Paper from a "hold" rating to a "sell" rating in a report on Saturday, October 3rd. Finally, UBS Group reduced their price objective on shares of International Paper from $47.00 to $35.00 and set a "neutral" rating for the company in a research report on Monday, October 5th. Ten research analysts have rated the stock with a Buy rating, three have given a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat.com, International Paper currently has a consensus rating of "Moderate Buy" and a consensus price target of $46.90.

Insider Buying and Selling at International Paper

In related news, VP William Hamic sold 24,500 shares of International Paper stock in a transaction dated Friday, August 7th. The stock was sold at an average price of $41.20, for a total value of $1,009,400.00. Following the transaction, the vice president owned 106,952 shares of the company's stock, valued at approximately $4,406,422.40. This trade represents a 18.64% decrease in their position. The sale was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, CAO Holly G. Goughnour sold 3,500 shares of the business's stock in a transaction dated Tuesday, August 4th. The stock was sold at an average price of $41.96, for a total value of $146,860.00. Following the sale, the chief accounting officer owned 34,248 shares in the company, valued at approximately $1,437,046.08. The trade was a 9.27% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Corporate insiders own 0.21% of the company's stock.

About International Paper

International Paper NYSE: IP is a global producer of sustainable packaging, pulp and paper products. Its offerings include corrugated packaging and containerboard used to protect and transport goods, as well as absorbent cellulose fibers and other fiber-based materials used in personal care, healthcare, foodservice and industrial applications.

The company serves customers across North America and Europe, with products sold to manufacturers, retailers, consumer-goods companies and other commercial customers.

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