10 Best Paper Stocks to Buy According to Hedge Funds

8. Sylvamo Corporation (NYSE:SLVM)

Number of Hedge Fund Holders: 16

​​​Sylvamo Corporation (NYSE:SLVM) is a global producer of uncoated freesheet paper, operating several integrated and non-integrated mills across the US, Brazil, France, and Sweden. The company’s product portfolio encompasses copy and printer papers, commercial printing papers, converting papers, and specialty papers, marketed under well-known brands. SLVM ranked eighth on our recent list of 12 Best Land and Timber Stocks to Buy According to Analysts.

Sylvamo Corporation (NYSE:SLVM) delivered strong financial results in 2024, generating a 23% return on invested capital while strengthening its competitive position in core uncoated freesheet markets. The company achieved significant financial milestones, including $632 million in adjusted EBITDA with a 17% margin, $248 million in free cash flow, and adjusted operating earnings of $7.42 per share, which was 14% higher than 2023. The company maintained strong financial discipline by repaying $154 million in debt, achieving a net debt-to-adjusted EBITDA ratio of 0.9x, and returning $130 million in cash to shareholders.

Looking ahead, Sylvamo Corporation (NYSE:SLVM) is making strategic investments to strengthen its competitive position, particularly at its flagship Eastover mill in South Carolina, where three high-return projects are being implemented. These projects, requiring approximately $145 million in investments over three years, are expected to generate an internal rate of return greater than 30% and create incremental adjusted EBITDA of more than $50 million per year. The company exceeded its Project Horizon cost reduction program goals by $34 million, achieving savings through manufacturing efficiencies, supply chain optimization, and overhead cost reductions. With strong guidance ahead and profitable rates of returns on its key projects, SLVM is one of the best paper stocks to consider in 2025.