Clearwater Paper Corporation (CLW) Q3 2025 Earnings Call Transcript
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 28 2025
0mins
Should l Buy CLW?
Source: SeekingAlpha
Adjusted EBITDA $18 million, which is towards the high end of the guidance range of $10 million to $20 million. Year-to-date adjusted EBITDA from continuing operations stands at $87 million, up from $26 million during the same period last year. This increase is driven mostly by efforts to reduce fixed costs and 4 incremental months of Augusta results included in the P&L.
Net Sales $399 million, up 1% year-over-year, driven by a 3% increase in paperboard shipment volumes partially offset by lower market pricing.
Net Loss from Continuing Operations $54 million or $3.34 per diluted share, primarily due to a $48 million noncash impairment of goodwill. This impairment was driven by the decline in market capitalization as compared to the increase in book value, which was driven by the gain from divestiture of the tissue business late last year.
Fixed Cost Reduction Initiatives Savings are now tracking to around $50 million for the year, exceeding the original estimate of $30 million to $40 million. These savings are helping offset some of the margin pressure during the industry down cycle.
Cash from Operations $34 million during the quarter.
Free Cash Flow Approximately $3.5 million during the quarter.
Net Leverage Ratio 2.7x, with aggregate debt level remaining stable despite the current industry down cycle.
Available Liquidity $455 million, providing ample financial flexibility.
SG&A as a Percent of Sales 6.2%, at the lower end of the targeted range of 6% to 7% of net sales, demonstrating a lean, cost-effective operation.
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Analyst Views on CLW
Wall Street analysts forecast CLW stock price to rise
2 Analyst Rating
2 Buy
0 Hold
0 Sell
Moderate Buy
Current: 16.940
Low
25.00
Averages
27.50
High
30.00
Current: 16.940
Low
25.00
Averages
27.50
High
30.00
About CLW
Clearwater Paper Corporation is an independent supplier of solid bleached sulfate (SBS) paperboard packaging products to North American converters. The Company produces quality paperboards that provides sustainable packaging solutions for consumer goods and food service applications. The Company operates through Pulp and Paperboard segment. It supplies bleached paperboard to quality-conscious printers and packaging converters, and offers services that include custom sheeting, slitting and cutting. SBS paperboard is a premium paperboard grade that is used to produce folding cartons (also includes blister and carded packaging and top sheet), food service (including liquid packaging, cups and plates) and commercial printing items. It produces paperboard that is then converted and printed by independent converters and primarily used in folding carton and food service applications. Food service paperboard includes both liquid packaging and cup and plate categories.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Clearwater Paper Q4 2025 Earnings Call Insights
- Performance Growth and Challenges: Clearwater Paper reported a 12% year-over-year increase in net sales to $386 million for 2025, primarily driven by full-year operations at the Augusta mill, yet faces pricing and margin pressures due to industry supply-demand imbalances.
- Significant Cost Control Success: Adjusted EBITDA reached $20 million, improving by $71 million from the previous year, attributed to exceptional cost management, with SG&A expenses reduced to 6.5% of net sales, demonstrating effective operational efficiency.
- Cautious Future Outlook: The company expects adjusted EBITDA to be approximately breakeven for Q1 2026 due to operational disruptions and $15 million to $20 million in incremental costs from severe weather, highlighting vulnerabilities in its financial outlook amid ongoing challenges.
- Strategic Investments and Product Launch: Clearwater plans to launch a new lightweight paperboard product line, Valora, in Q2, and has completed engineering feasibility for a $60 million investment at Cypress Bend, aiming to capture 100,000 to 150,000 tons of market demand.
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- Revenue Decline Forecast: The anticipated revenue for Q4 stands at $368 million, representing a 23.8% year-over-year drop, which highlights weak market demand and industry challenges that could negatively impact future cash flow and investment capacity.
- Historical Performance Review: Over the past year, Clearwater Paper has beaten EPS estimates 75% of the time and revenue estimates 75% of the time, indicating relative stability in financial forecasting, yet the recent downward revisions raise concerns about future performance.
- Forecast Revision Trends: In the last three months, there have been no upward revisions to EPS estimates and one downward revision, with revenue estimates also seeing no upward revisions and one downward revision, suggesting a waning analyst confidence in the company's future outlook, which may affect investor sentiment.
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- High Put Option Volume: Notably, the $510 strike put option has traded 10,335 contracts today, representing about 1.0 million shares, reflecting market concerns regarding potential future declines in the stock price.
- Clearwater Options Activity: Clearwater Paper Corp's options volume stands at 1,524 contracts today, equivalent to approximately 152,400 shares, reaching 76% of its average daily volume of 200,630 shares over the past month, indicating investor interest in the company.
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See More
Clearwater Paper Q4 2025 Earnings Call Insights
- Performance Growth and Challenges: Clearwater Paper reported a 12% year-over-year increase in net sales to $386 million for 2025, primarily driven by full-year operations at the Augusta mill, yet faces pricing and margin pressures due to industry supply-demand imbalances.
- Significant Cost Control Success: Adjusted EBITDA reached $20 million, improving by $71 million from the previous year, attributed to exceptional cost management, with SG&A expenses reduced to 6.5% of net sales, demonstrating effective operational efficiency.
- Cautious Future Outlook: The company expects adjusted EBITDA to be approximately breakeven for Q1 2026 due to operational disruptions and $15 million to $20 million in incremental costs from severe weather, highlighting vulnerabilities in its financial outlook amid ongoing challenges.
- Strategic Investments and Product Launch: Clearwater plans to launch a new lightweight paperboard product line, Valora, in Q2, and has completed engineering feasibility for a $60 million investment at Cypress Bend, aiming to capture 100,000 to 150,000 tons of market demand.
See More
Clearwater Paper Set to Announce Q4 Earnings on February 18
- Earnings Announcement Date: Clearwater Paper is set to release its Q4 earnings on February 18, with a consensus EPS estimate of -$0.54, reflecting a staggering 104.5% year-over-year decline, indicating significant profitability challenges for the company.
- Revenue Decline Forecast: The anticipated revenue for Q4 stands at $368 million, representing a 23.8% year-over-year drop, which highlights weak market demand and industry challenges that could negatively impact future cash flow and investment capacity.
- Historical Performance Review: Over the past year, Clearwater Paper has beaten EPS estimates 75% of the time and revenue estimates 75% of the time, indicating relative stability in financial forecasting, yet the recent downward revisions raise concerns about future performance.
- Forecast Revision Trends: In the last three months, there have been no upward revisions to EPS estimates and one downward revision, with revenue estimates also seeing no upward revisions and one downward revision, suggesting a waning analyst confidence in the company's future outlook, which may affect investor sentiment.
See More
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- Market Weakness: Home furnishings stocks collectively fell by approximately 2.5%, indicating a decline in market confidence that could impact future investment decisions.
- Arhaus Leads Decline: Arhaus shares dropped by about 5%, reflecting weak consumer demand and increased market competition, which may lead to a decrease in the company's short-term sales.
- RH Struggles: RH's stock fell by approximately 4.9%, indicating challenges in the high-end home market that could affect its profitability and market share.
- Uncertain Industry Outlook: Other sectors like paper and forest products also performed poorly, suggesting that the overall economic environment may exert pressure on the home improvement industry, necessitating close monitoring of future market dynamics.
See More
Analysts Upgrade Agilent and Others, Target Price Set at $180
- Agilent Upgrade: HSBC analyst Sidharth Sahoo initiated coverage on Agilent Technologies Inc (NYSE:A) with a Buy rating and a price target of $180, indicating significant upside from Friday's close of $139.64, reflecting optimism about its future growth prospects.
- Group 1 Automotive Outlook: Evercore ISI Group analyst John Saager initiated coverage on Group 1 Automotive Inc (NYSE:GPI) with an Outperform rating and a price target of $500, suggesting potential upside from Friday's close of $395.06, indicating strong market confidence in its performance.
- Brinker International Potential: TD Cowen analyst Andrew M. Charles initiated coverage on Brinker International Inc (NYSE:EAT) with a Buy rating and a price target of $192, showing a clear increase from Friday's close of $157.68, reflecting a positive outlook on its future profitability.
- Clearwater Paper Stability: Truist Securities analyst Michael Roxland initiated coverage on Clearwater Paper Corp (NYSE:CLW) with a Hold rating and a price target of $21, slightly above Friday's close of $20.09, indicating a cautious market stance on its stability.
See More
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- Active Options Trading: Microsoft options have seen a trading volume of 171,422 contracts today, equivalent to approximately 17.1 million shares, indicating a robust activity level at 78.4% of the average daily volume of 21.9 million shares over the past month.
- High Put Option Volume: Notably, the $510 strike put option has traded 10,335 contracts today, representing about 1.0 million shares, reflecting market concerns regarding potential future declines in the stock price.
- Clearwater Options Activity: Clearwater Paper Corp's options volume stands at 1,524 contracts today, equivalent to approximately 152,400 shares, reaching 76% of its average daily volume of 200,630 shares over the past month, indicating investor interest in the company.
- Call Option Trading: Among Clearwater's options, the $20 strike call option has seen 1,510 contracts traded, representing about 151,000 shares, suggesting investor expectations for future price increases in the stock.
See More
Clearwater Ranked 36th on MSSP Alert's 2025 Top Global MSSPs List
- Ranking Improvement: Clearwater's ascent to 36th place on MSSP Alert's 2025 Top Global MSSPs list highlights strong growth in its managed security services, reflecting increased client trust, particularly in the healthcare and defense sectors.
- Rising Client Demand: As cyber threats intensify, demand for Clearwater's Managed Security Services (MSS) is surging, especially among organizations in highly regulated environments, showcasing the company's market leadership in complex compliance-driven industries.
- Service Innovation: Clearwater's offerings, including continuous monitoring, threat detection and response, and cloud security, enable clients to enhance their security posture while meeting regulatory obligations, further solidifying its competitive advantage in the industry.
- Team Recognition: President Baxter Lee emphasized that the dedication of the team and the trust of clients are key to the company's continued rise, and this recognition not only enhances brand image but also strengthens customer loyalty.
See More
