Clearwater Paper falls 28.8% after weak third-quarter results

What happened

Clearwater Paper (CLW) fell 28.8% on October 27, 2026, because its third-quarter results showed a net loss, weaker sales and operational problems at a key mill. The company reported net sales of $385 million versus $399 million a year earlier and a net loss of $2 million; adjusted EBITDA was $24 million, inside the company’s prior guidance range of $20 million to $30 million as recent price increases began to help results.

Management said production disruptions and additional maintenance requirements at its Augusta mill reduced output and contributed to softer sales and margins. Separately, Clearwater Paper completed a debt refinancing that extends its debt maturity profile to 2031, a move management said should ease near-term liquidity pressures.

How big was the move

The stock closed at $13.69 after opening 11.2% below the previous close, with trading volume 12.6 times its 20-day average. The move was 5.9 times a typical daily move for this stock and was 30.7 percentage points worse than the Basic Materials sector median, which rose 1.9% on the day. The S&P 500 rose 0.6% on the session and rose 0.1% over five sessions, while the stock fell 27.8% over the last five sessions.

Investors punished the earnings miss and the operational update even as management pointed to pricing gains and a refinancing. The scale of the selloff magnified short-term volatility and pushed the stock sharply away from recent trading ranges.

The technical picture

The stock sat 27.8% below its 20-day moving average, 31.9% below its 50-day moving average and 20.3% below its 200-day moving average. The 50-day average remained above the 200-day average, a sign of an established uptrend, even as recent price action pushed the stock well below those levels. The Relative Strength Index (14 days) was 23, below 30, a level often called oversold, and the stock was 42.0% below the 52-week high.

Volatility was elevated, with 78% annualized over 60 days, the highest reading of the past five years. Over one month the stock fell 31.2% and over three months it fell 36.6%, leaving it 31.3% lower than a year earlier and 45.0 percentage points behind the S&P 500 over the same period. The stock’s beta of 0.79 indicates the stock tends to move less than the market.

Fundamentals and valuation

For the four quarters through September 30, 2026, Clearwater Paper reported revenue of $1.51 billion, a decline of 3.2% from a year earlier. Diluted earnings per share were $0.16 and gross margin was 1.8%, compared with 7.3% a year earlier; operating margin was 3.1%, versus 0.1% a year earlier. Free-cash-flow margin was 3.8% for the period and return on invested capital was 3.2%.

The balance sheet showed net debt of 9.0 times EBITDA. Valuation metrics showed price to trailing earnings of 85.6 times trailing earnings and a free-cash-flow yield of 18.3%. Price to trailing earnings was higher than 91% of its own readings over the past five years, where the five-year median was 12.4 times earnings.

PromtFinance scores ranked the company within its sector with Value 69 (Positive), Growth 7 (Very weak), Quality 19 (Very weak), Momentum 36 (Weak), Revisions 25 (Very weak) and Stability 15 (Very weak). Those scores highlight a tension between an inexpensive-looking cash yield and weak profit and quality metrics.

Earnings and analyst expectations

Clearwater Paper reported on October 26, 2026, earnings per share of $-0.23 against $-0.15 expected, 48.4% below estimates. The company has recorded zero consecutive quarters beating estimates and its average surprise over the last four reports was 12.1% below estimates. The typical two-day reaction after recent reports was a rise of 1.0%.

Eleven analysts covered the stock, with 55% rating the stock Buy or Strong Buy and a consensus rating of Buy. The consensus price target was $19.33, 41.2% above the closing price. The next report was scheduled for February 17, 2027.

What to watch

• October 26, 2026: third-quarter results showing net sales of $385 million, net loss of $2 million, and adjusted EBITDA of $24 million.
• Management comments on production disruptions and additional maintenance requirements at its Augusta mill as described in the report.
• Completion of a debt refinancing that extends the debt maturity profile to 2031.
• Upcoming February 17, 2027, earnings report date.
• Balance sheet metric: net debt of 9.0 times EBITDA.