NEW YORK, July 24, 2026 – Shares of International Paper (NYSE: IP) surged 11.2% to close at $42.16 on Friday, marking a dramatic single-session rally that accounted for nearly 93% of the stock's 12.2% weekly gain. The broader S&P 500 edged up just 0.05% on the day, underscoring the outsized move in the paper and packaging sector.
The catalyst came from a research note by Truist analyst Michael Roxland, who reported that Packaging Corporation of America (NYSE: PKG) plans to raise containerboard prices by $140 per ton in September. Roxland expects International Paper and Smurfit WestRock (NYSE: SW) to follow with similar increases. He maintained Buy ratings on all three stocks, stating that "higher containerboard prices should be positive for PKG, SW, and IP."
The price action added approximately $2.3 billion to International Paper's market value on Friday alone, with the stock closing near its session high. The move was particularly notable given that the company had not issued any new guidance or disclosures. International Paper maintains its preliminary, unaudited Q2 adjusted EBITDA guidance of $520 million to $570 million, with a midpoint of $545 million — a 19.5% decline from Q1's $677 million. Full-year adjusted EBITDA is projected between $3.2 billion and $3.5 billion.
The timing of the anticipated price hike is crucial. The increase would only impact the last month of the third quarter, meaning it has no bearing on Q2 results. According to International Paper, pricing typically recovers after a delay. The equity value added on Friday was 4.2 times the midpoint of Q2 EBITDA, representing 68% of the full-year midpoint, suggesting investors are looking beyond near-term earnings weakness.
Peer companies also rallied sharply. Smurfit WestRock gained 11.1% to close at $48.56, while Packaging Corp. rose 8.8% to $254.39. The relative gains were significant because both International Paper and Smurfit had underperformed PCA over the past 12 months, with IP down 24%, SW off less than 1%, and PCA up 23%. Analysts see further rerating potential for the underperformers.
PCA's second-quarter report, released Thursday, provided operational strength to back the rally. Legacy corrugated shipments increased 4.1% to a new quarterly high, with mills operating at full capacity. CEO Mark Kowlzan noted that demand "remained strong throughout the entire quarter." PCA reduced export sales by nearly 30,000 tons to prioritize meeting local box demand.
Cost pressures remain a key challenge. Higher freight expenses reduced PCA's legacy earnings by $0.26 per share, while weaker packaging price and mix took off an additional $0.11. International Paper benefits from its own volume stability — in Q1, North American box shipments outperformed industry demand by roughly 3%. However, segment profit for the region fell to $248 million from $319 million in the prior period.
Smurfit WestRock is scheduled to report earnings on Wednesday, with International Paper reporting before Thursday's market open. Markets will be watching for a comparable pricing update and maintained full-year guidance. Risks to the $140 price hike include potential pushback from customers, softer box demand, and rising freight costs that could erode gains.
