IP
International Paper Company$44.02
Unclear
Target $24.91
Report: Feb 26, 2026Consumer Cyclical • Packaging & Containers • Cyclical OperatorSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$44.02-43.4%
Rec: UnclearConviction: Medium
Entry Target
$19.16
(56% below current)
Fair Value
$24.91
(43% below current)
Stop Loss
$29.01
(34% below current)
Position Size
Starter
Time Horizon
Transitional
Key Metrics
Live Snapshot
Market Data
52 Week High$56.13
52 Week Low$33.57
Avg. 3 Month Volume7.07M
Efficiency
LTM Gross Margin29.6%
LTM EBITDA Margin-3.4%
LTM EBIT Margin-15.6%
LTM Operating Margin-12.8%
LTM ROA-8.7%
LTM ROE-20.4%
LTM ROIC-11.1%
LTM ROCE-12.2%
Capital Structure
Market Cap (MM)$18.9B
Enterprise Value (MM)$30.2B
Shares Outstanding529.47M
Total Debt (MM)$12.44B
Cash & Equivalents (MM)$1.15B
LTM Net Debt (MM)$11.30B
LTM Net Debt/EBITDA-14.2x
Growth
TTM Rev. Growth33.7%
Last 3-Yr Rev. CAGR5.6%
Last 3-Yr EBITDA CAGRN/A
Last 3-Yr EPS CAGRN/A
Valuation
Street Target Price$47.97
LTM EV/Revenue1.3x
LTM EV/Gross Profit4.1x
LTM EV/EBIT-8.2x
LTM EV/EBITDA-37.8x
LTM P/E-5.4x
LTM EV/FCF511.9x
LTM P/FCF320.4x
LTM P/TB0.7x
LTM P/B1.3x
Dividend Yield5.2%
Payout Ratio-27.0%
Executive SummarySituation: Current price is $44.02 versus fair value $24.91 (-43.4% expected return), and valuation confidence is insufficiently stable. Debate: Bull case depends on Completion of the regional separation into North America and EMEA entities. Bear case centers on A 'lower-for-longer' cyclical downturn in European packaging demand impairs the DS Smith assets further, leading to additional goodwill write-downs. Conclusion: Recommendation is Unclear; maintain no position until reliability and catalyst evidence improve.
Bull Case
The 80/20 program is delivering tangible results, with $510 million in run-rate benefits already achieved and $500 million in incremental 2026 North American savings projected. The regional split will unlock value by allowing the high-performing North American business to trade at a premium to the troubled EMEA operations.
Bear Case
The $2.47 billion goodwill impairment and negative $159 million free cash flow in 2025 suggest the DS Smith acquisition was overvalued and poorly timed. Ongoing antitrust litigation and a 5.6x net leverage ratio create a precarious financial position that could force a dividend cut if the cyclical recovery lags.
Key Catalysts
Mid-Term (6-18 months)Impact: Critical
Completion of the regional separation into North America and EMEA entities. This addresses the market's concern regarding the 'conglomerate...
Near-Term (0-6 months)Impact: High
Realization of price increase letters issued in both North America and EMEA. A $10/ton price increase would add approximately $90 million to...
Long-Term (18+ months)Impact: Moderate
International Paper is relevant at this moment because it has just reported a massive $2.84 billion loss and announced a definitive split, c...
Primary Risks
Concern: High
A 'lower-for-longer' cyclical downturn in European packaging demand impairs the DS Smith assets further, leading to additional goodwill writ...
Concern: Medium
Adverse outcome in the federal antitrust class-action lawsuit alleging price-fixing of containerboard.
Concern: Medium
The stewardship verdict is currently in transition. We outline the Governance Outcome Tree as follows: 1. Status Quo: Management executes th...
Recent Activity
2026-01-29SEC Filing (8-K)
-6.00%International Paper announced plans to create two independent public companies through separation of its North America and EMEA packaging solutions businesses, while reporting full-year 2025 results including a $2.84 billion loss from...
2025-10-30SEC Filing (8-K)
-12.66%International Paper reported Q3 2025 earnings (loss) from continuing operations of $(426) million, including $675 million in accelerated depreciation from mill closures and strategic actions.
2025-07-31SEC Filing (8-K)
-12.85%International Paper reports second quarter 2025 net earnings of $75 million with adjusted operating earnings of $105 million.
2025-07-01SEC Filing (8-K)
+5.59%International Paper completes divestiture of five European corrugated box plants to PALM Group.
2025-03-25SEC Filing (8-K)
+6.49%International Paper to host Investor Day on March 25, 2025 to discuss strategic plans and DS Smith acquisition.
Valuation Table
4.2/10Directional
Scenario Range
$0
Bear
$25
Base
$23
Bull
$44