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1. Company Snapshot

1.a. Company Description

Interfor Corporation, together with its subsidiaries, produces and sells wood products in Canada, the United States, Japan, China, Taiwan, and internationally.The company offers lumber products for decking, fascia and trims, framings, furniture, industrial packaging, Japan Zairai, millworks, paneling, sidings, trusses, and windows and doors.It also provides logs, wood chips, and other residuals.


The company was formerly known as International Forest Products Limited and changed its name to Interfor Corporation in May 2014.Interfor Corporation was incorporated in 1963 and is headquartered in Burnaby, Canada.

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1.b. Last Insights on IFP

Interfor Corporation's recent performance was negatively driven by a challenging Q3 2024, marked by a net loss of $106 million and adjusted EBITDA loss of $22 million. The company's revenue declined, and it reported a significant increase in net loss compared to Q2 2024 and Q3 2023. Additionally, Interfor's decision to exit its operations in Québec, Canada, including the sale of its manufacturing facilities and closure of its Montréal corporate office, may have contributed to the negative performance. Furthermore, the US lumber industry's potential to surpass Canada's dominance due to trade restrictions and tariffs may have also impacted Interfor's performance.

1.c. Company Highlights

2. Interfor's Q4 Earnings: Navigating Weak Lumber Prices and Market Volatility

Interfor reported a weak financial performance in Q4, with revenues impacted by the challenging lumber market conditions. The actual EPS came out at -$1.5907, significantly worse than the estimated -$0.01483. The company's financial results were affected by production curtailments, but showed sequential improvement compared to the previous quarter, driven by lower production costs and improved working capital performance. The P/E Ratio stands at -1.73, indicating that the stock is trading at a discount, but the negative earnings make it challenging to rely on this metric.

Publication Date: Mar -07

📋 Highlights
  • B.C. Coast asset sale: Expected to generate $30M–$35M over 12–18 months, with real estate divestiture proceeds in a similar range.
  • Q4 sequential improvement: Driven by lower production costs and improved working capital performance despite weak lumber market conditions.

Operational Highlights

Despite the challenging market conditions, Interfor continued to execute with discipline, taking steps to reinforce liquidity, adjusting operating postures at several mills, and permanently closing two high-cost facilities. The company's efforts to reduce working capital performance and advance the final phase of the Thomaston mill in Georgia are also notable. As Ian Fillinger, Interfor's President and CEO, mentioned, the company is strengthening its position in a challenging market.

Market Outlook

The economic environment remains uncertain due to trade and geopolitical developments. However, the U.S. economy continues to show resilience, and the company is starting to see the impact of production curtailments across the industry, which is beginning to balance the lumber markets. Bart Bender, Senior Vice President of Sales and Marketing, noted that the industry is experiencing a positive shift, which should benefit Interfor in the long run.

Balance Sheet and Cash Flow

Interfor has made significant progress in clearing out the maturity runway and anticipates lower spending going forward. Mike Mackay, Executive Vice President and Chief Financial Officer, stated that the company has directed free cash flow towards debt reduction targets. The Net Debt / EBITDA ratio stands at -4.76, indicating a relatively healthy debt position. However, the Free Cash Flow Yield is -9.16%, which is a concern.

Valuation

The P/S Ratio is 0.18, indicating that the stock is trading at a discount relative to its revenues. The EV/EBITDA ratio is -7.59, which is not a reliable metric given the company's negative EBITDA. Analysts estimate next year's revenue growth at 11.8%, which could potentially lead to an improvement in the company's financial performance.

3. NewsRoom

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CIBC Says "High-cost" Lumber Producers Thrown Lifeline

Nov -27

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TSX up 215 Points With Miners The Best Performer

Nov -26

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Interfor Corp (IFSPF) Q3 2025 Earnings Call Highlights: Navigating Market Challenges with ...

Nov -08

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Interfor Q3 Loss Widens on Weak Lumber Prices; Warns of Impact from New U.S. Tariffs

Nov -06

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Interfor Reports Q3’25 Results

Nov -06

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Lumber Firm Interfor Deepens Production Cuts

Oct -17

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Interfor Announces Incremental Lumber Production Curtailments for the Fourth Quarter of 2025

Oct -17

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TSX Closer: Up More Than 500 Pts As Gold and Silver Shine, and Desjardins Plays Down Impact of Latest Targeted U.S. Tariffs

Oct -14

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.03%)

6. Segments

Lumber and Other Wood

Expected Growth: 8%

Interfor Corporation's Lumber and Other Wood segment growth of 8% is driven by increasing demand from the US housing market, strong repair and remodeling activity, and rising prices due to supply chain constraints and tariffs on Canadian lumber. Additionally, the company's strategic capital investments in modernizing its mills and expanding production capacity have improved operational efficiency and productivity.

Wood Chips and Other By-Products

Expected Growth: 7%

Interfor Corporation's 7% growth in Wood Chips and Other By-Products is driven by increasing demand for sustainable packaging, rising pulp prices, and expanding bioenergy markets. Additionally, the company's strategic investments in modernizing its mills and optimizing production processes have improved operational efficiency, further contributing to growth.

Logs

Expected Growth: 10%

Interfor Corporation's 10% growth is driven by increasing lumber prices, strong demand from the US housing market, and strategic acquisitions. The company's focus on operational efficiency, cost reduction, and capital investments in its mills have also contributed to its growth. Additionally, Interfor's diversified product mix and geographic presence have helped mitigate risks and capitalize on market opportunities.

Other

Expected Growth: 9%

Interfor Corporation's 9% growth is driven by increasing lumber prices, strong demand from the repair and remodeling market, and the company's strategic capital investments in its mills, which have improved operational efficiency and increased production capacity.

7. Detailed Products

Lumber

Interfor Corporation produces a wide range of lumber products, including dimension lumber, timbers, and specialty products, used in construction, renovation, and industrial applications.

Specialty Products

Interfor offers a variety of specialty products, including western red cedar, cypress, and other specialty softwoods, used for outdoor and decorative applications.

Log Products

Interfor harvests and sells logs to domestic and international markets, used for pulp, paper, and other wood-based products.

Bioenergy Products

Interfor produces bioenergy products, including wood chips and hog fuel, used to generate electricity and heat.

8. Interfor Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Interfor Corporation's products are moderately substitutable, as customers have some alternatives, but they are not easily replaceable.

Bargaining Power Of Customers

Interfor Corporation's customers have limited bargaining power due to the company's strong market position and diversified customer base.

Bargaining Power Of Suppliers

Interfor Corporation's suppliers have moderate bargaining power, as the company relies on a few key suppliers, but has some flexibility in its supply chain.

Threat Of New Entrants

The threat of new entrants is low for Interfor Corporation, as the forestry industry has significant barriers to entry, including high capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry in the forestry industry is high, with several large players competing for market share, leading to pricing pressure and high marketing expenses.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 35.15%
Debt Cost 10.07%
Equity Weight 64.85%
Equity Cost 17.17%
WACC 14.67%
Leverage 54.21%

11. Quality Control: Interfor Corporation passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Mativ

A-Score: 4.4/10

Value: 8.6

Growth: 1.9

Quality: 2.0

Yield: 7.0

Momentum: 5.0

Volatility: 2.0

1-Year Total Return ->

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Stock-Card
Canfor

A-Score: 4.3/10

Value: 10.0

Growth: 1.9

Quality: 3.3

Yield: 0.0

Momentum: 3.0

Volatility: 7.3

1-Year Total Return ->

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Jewett-Cameron Trading

A-Score: 4.3/10

Value: 10.0

Growth: 2.4

Quality: 4.8

Yield: 0.0

Momentum: 6.0

Volatility: 2.3

1-Year Total Return ->

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Stock-Card
Glatfelter

A-Score: 3.8/10

Value: 7.6

Growth: 4.8

Quality: 3.3

Yield: 1.0

Momentum: 6.0

Volatility: 0.3

1-Year Total Return ->

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Stock-Card
Interfor

A-Score: 3.8/10

Value: 9.1

Growth: 3.9

Quality: 3.0

Yield: 1.0

Momentum: 1.0

Volatility: 5.0

1-Year Total Return ->

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Stock-Card
Clearwater Paper

A-Score: 2.9/10

Value: 8.2

Growth: 1.3

Quality: 3.2

Yield: 0.0

Momentum: 0.5

Volatility: 4.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

10.57$

Current Price

10.57$

Potential

-0.00%

Expected Cash-Flows