A Look at International Paper’s Valuation Following Q3 Losses and Revised Guidance

International Paper (NYSE:IP) just reported a considerable net loss for the third quarter, with softer earnings across its Packaging Solutions segments. The company also trimmed its full-year outlook as box shipments weaken in the face of broad economic headwinds.

See our latest analysis for International Paper.

After trending lower for most of the year, International Paper’s share price has slid 16.98% in the past month alone and is down 28.65% year-to-date, with investors clearly factoring in weak results and lingering market uncertainty. Over the longer run, the total shareholder return tells a mixed story. It is up 18.6% over three years but has fallen 31.8% in the past twelve months as near-term momentum fades.

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So, after a sharp decline in the share price and weaker near-term forecasts, is International Paper undervalued at these levels? Or is the market already factoring in the company’s growth challenges and future prospects?

Most Popular Narrative: 19.6% Undervalued

International Paper's most widely followed narrative sees a fair value meaningfully above the last close, suggesting the market may not be fully appreciating the company’s potential turnaround. This latest valuation uses a 7.34% discount rate and reflects a detailed analyst consensus on revenue and margin recovery ahead.

“The acceleration of global e-commerce continues to support steady and growing demand for corrugated packaging, giving International Paper a long-term volume growth tailwind and improving top line stability, even amid economic volatility.”

Read the complete narrative.

Which bold projections drive this eye-catching upside? Analysts are betting on much-improved profit margins, rapid earnings growth, and a future financial profile that will surprise many investors. Curious about the assumptions fueling this narrative’s price target? The numbers may challenge your expectations.

Result: Fair Value of $47.16 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, ongoing mill reliability issues and sluggish demand in key markets could easily undermine the optimistic outlook and stall any rapid margin recovery.

Find out about the key risks to this International Paper narrative.

Build Your Own International Paper Narrative

If this viewpoint doesn’t match yours or you’d like to dig deeper using your own analysis, you can craft a personal narrative in just a few minutes: Do it your way

A great starting point for your International Paper research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.

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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.

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