Investors in Sylvamo Corporation (NYSE:SLVM) had a good week, as its shares rose 5.3% to close at US$40.30 following the release of its second-quarter results. Things were not great overall, with a surprise (statutory) loss of US$0.28 per share on revenues of US$806m, even though the analysts had been expecting a profit. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Taking into account the latest results, Sylvamo's four analysts currently expect revenues in 2026 to be US$3.31b, approximately in line with the last 12 months. Statutory per-share earnings are expected to be US$1.89, roughly flat on the last 12 months. Before this earnings report, the analysts had been forecasting revenues of US$3.34b and earnings per share (EPS) of US$2.71 in 2026. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a large cut to EPS estimates.

It might be a surprise to learn that the consensus price target fell 6.8% to US$51.25, with the analysts clearly linking lower forecast earnings to the performance of the stock price. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Sylvamo analyst has a price target of US$65.00 per share, while the most pessimistic values it at US$45.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Sylvamo's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Sylvamo's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 0.7% growth on an annualised basis. This is compared to a historical growth rate of 2.8% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.4% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Sylvamo.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Sylvamo's revenue is expected to perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on Sylvamo. Long-term earnings power is much more important than next year's profits. We have forecasts for Sylvamo going out to 2028, and you can see them free on our platform here.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.