Sylvamo's (SLVM) earnings should improve into 2027 as price gains, fewer mill issues, North America investments, and cost-savings work to offset near-term cost pressure and market uncertainty, RBC Capital Markets said in a note Monday.

The investment firm said it remains somewhat cautious because some price increases may not fully hold and paper imports could affect the North American market, while Sylvamo expects about $15 million in higher costs in Q2, though better pricing, fewer reliability problems, and the end of a prior Riverdale payment could help offset that pressure.

US uncoated free sheet prices are moving higher and could rise further because of tight supply, while prices in Europe, Latin America, and export markets may also improve modestly, RBC said.

RBC added 2026 looks like a transition year for Sylvamo, with investors likely to focus more on the company's path toward stronger 2027 results as the year moves forward.

RBC kept its sector perform rating and cut its price target for Sylvamo to $49 from $50.

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