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Cascades
(TSX:CAS)
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Rating:64Neutral
Price Target:
C$20.00
▲(20.70% Upside)
Action:Reiterated
Date:08/10/26
The score is driven primarily by improving financial performance (return to profitability and stronger free cash flow), supported by positive earnings-call guidance and planned pricing actions. These positives are tempered by elevated leverage and thin/volatile margins, while technically the uptrend is strong but appears overextended based on very high RSI/Stoch readings.
Positive Factors
Profitability and cash-flow recovery
The return to positive earnings after several loss-making years, together with stronger operating and free cash flow, indicates meaningful business recovery. Improved cash generation can support reinvestment, debt service, and operational initiatives, giving Cascades greater flexibility over the next several quarters.
Negative Factors
Elevated leverage
Leverage remains high for a cyclical packaging company even after a modest reduction in net debt. This limits financial flexibility, increases sensitivity to weaker volumes or margins, and can constrain capital allocation while management works to improve the balance sheet.
Read all positive and negative factors
Positive Factors
Negative Factors
Profitability and cash-flow recovery
The return to positive earnings after several loss-making years, together with stronger operating and free cash flow, indicates meaningful business recovery. Improved cash generation can support reinvestment, debt service, and operational initiatives, giving Cascades greater flexibility over the next several quarters.
Read all positive factors
Cascades (CAS) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$1.76B
Dividend Yield2.76%
Average Volume (3M)361.58K
Price to Earnings (P/E)13.8
Beta (1Y)1.18
Revenue Growth0.55%
EPS GrowthN/A
CountryCA
Employees8,900
SectorConsumer Cyclical
Sector Strength84
IndustryPackaging & Containers
Share Statistics
EPS (TTM)1.26
Shares Outstanding101,420,100
10 Day Avg. Volume319,780
30 Day Avg. Volume361,576
Financial Highlights & Ratios
PEG Ratio-0.06
Price to Book (P/B)0.73
Price to Sales (P/S)0.26
P/FCF Ratio5.55
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$19.17Price Target Upside15.67% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
EPS Forecast (FY)1.18
Revenue Forecast (FY)C$4.95B
Cascades Business Overview & Revenue Model
Company Description
Cascades Inc. is a prominent North American manufacturer, converter, and distributor specializing in a diverse range of packaging and tissue paper products. The company's operations are strategically divided into three key business units: Containe...
How the Company Makes Money
Cascades makes money primarily by manufacturing and selling packaging and tissue products to business customers (and, in tissue, also to retail and away-from-home channels), earning revenue from the sale of both raw materials and converted/finishe...
Cascades Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call conveyed a generally positive operational and financial trajectory driven by sequential improvements in both Packaging and Tissue, record production at multiple mills, meaningful sequential increases in sales, EBITDA and cash flow, progress on profitability programs and asset monetization, and clear price actions planned to support margins. Offsetting factors include ongoing raw material and transportation cost inflation, a modest year-over-year EBITDA decline in Tissue, specific financial losses, unchanged leverage at 3.3x, and potential downside from newly announced U.S. tariffs (assessment underway, estimated up to 5% of adjusted EBITDA run rate). On balance, reported operational momentum, improving cash generation, and management’s mitigation and pricing actions outweigh the headwinds discussed.Positive Updates
Packaging Sequential Sales and EBITDA Growth
Packaging sales rose to $772 million, up 8% sequentially, and adjusted EBITDA increased 16% sequentially to $120 million, with EBITDA margin improving to 15.5% from 14.4% in Q1 2026.
Negative Updates
Raw Material Cost Inflation
Recycled fiber index prices rose by more than 10% sequentially (though slightly below prior-year levels); hardwood pulp and eucalyptus costs increased by as much as 15% sequentially and year-over-year, increasing input cost pressure.
Read all updates
Q2-2026 Updates
Positive
Negative
Packaging Sequential Sales and EBITDA Growth
Packaging sales rose to $772 million, up 8% sequentially, and adjusted EBITDA increased 16% sequentially to $120 million, with EBITDA margin improving to 15.5% from 14.4% in Q1 2026.
Read all positive updates
Company Guidance
The company guided to sequential improvement in Q3 (Packaging EBITDA cited in Q&A at $135–$140 million), expects its annual run‑rate adjusted EBITDA to exceed $600 million in the second half of 2026, and said recently announced price increases of $110/ton on linerboard/white grades and $140/ton on medium (effective Sept. 8) should begin to help results in Q4; management warned the U.S. administration’s 50% tariff announcement could affect some exports but, after mitigation, would not exceed 5% of the adjusted EBITDA run rate. Financial posture guidance included unchanged 2026 CapEx of $150–$175 million, continued asset‑monetization toward a $230 million target (already $163 million realized, $105 million proceeds YTD including a $9 million Lachine sale), modest Q2 net debt reduction of $22 million, unchanged leverage at 3.3x, available liquidity of $737 million, and Q2 adjusted operating cash flow of $123 million (up 22% year‑over‑year).Cascades Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
54
Neutral
Cash Flow
66
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.78B | 4.78B | 4.70B | 4.64B | 4.47B | 3.96B |
| Gross Profit | 533.00M | 565.00M | 1.85B | 1.66B | 1.63B | 491.00M |
| EBITDA | 560.00M | 556.00M | 392.00M | 330.00M | 273.00M | 281.00M |
| Net Income | 126.00M | 70.00M | -31.00M | -76.00M | -14.00M | -47.00M |
Balance Sheet | ||||||
| Total Assets | 4.83B | 4.67B | 5.00B | 4.77B | 5.05B | 4.57B |
| Cash, Cash Equivalents and Short-Term Investments | 96.00M | 52.00M | 28.00M | 54.00M | 111.00M | 175.00M |
| Total Debt | 1.98B | 1.94B | 2.12B | 1.94B | 2.07B | 1.52B |
| Total Liabilities | 3.01B | 2.92B | 3.23B | 2.99B | 3.13B | 2.64B |
| Stockholders Equity | 1.78B | 1.72B | 1.72B | 1.74B | 1.87B | 1.88B |
Cash Flow | ||||||
| Free Cash Flow | 357.00M | 227.00M | 88.00M | 159.00M | -362.00M | -90.00M |
| Operating Cash Flow | 498.00M | 379.00M | 272.00M | 510.00M | 144.00M | 211.00M |
| Investing Cash Flow | 15.00M | -94.00M | -150.00M | -332.00M | -486.00M | -247.00M |
| Financing Cash Flow | -442.00M | -263.00M | -149.00M | -225.00M | 272.00M | -529.00M |
Cascades Technical Analysis
Positive
16.57
Price Trends
17.31
Positive
15.08
Positive
13.29
Positive
Market Momentum
-0.05
Positive
49.43
Neutral
30.41
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CAS, the sentiment is Positive. The current price of 16.57 is below the 20-day moving average (MA) of 17.62, below the 50-day MA of 17.31, and above the 200-day MA of 13.29, indicating a neutral trend. The MACD of -0.05 indicates Positive momentum. The RSI at 49.43 is Neutral, neither overbought nor oversold. The STOCH value of 30.41 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:CAS.
Cascades Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | C$16.55B | 20.93 | 14.41% | 1.43% | 5.44% | 4.67% | |
72 Outperform | C$2.62B | 13.81 | 10.23% | 0.45% | 3.27% | 2.08% | |
64 Neutral | C$1.76B | 13.78 | 7.24% | 2.76% | 0.55% | ― | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
61 Neutral | C$480.39M | 1.40 | 29.10% | 295.64% | -43.09% | 91.71% | |
60 Neutral | C$311.45M | 14.90 | 10.96% | 4.63% | 6.70% | 14.27% | |
60 Neutral | C$79.08M | 6.55 | 11.20% | 21.54% | 3.78% | ― |
* Consumer Cyclical Sector Average
TSE:CAS
Cascades
17.36
6.67
62.38%
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Cascades Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Cascades Moves to Partially Redeem US$100 Million of 2028 Senior Notes
Positive
Aug 20, 2026
Cascades Inc. has announced a partial redemption of US$100 million of its co‑issued 5.375% senior notes due 2028, which are held jointly by the company and its indirect wholly owned subsidiary, Cascades USA Inc. The redemption, set for Septe...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.