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    Why Cascades (TSX:CAS) Is Up 15.8% After Swinging Back To Profit On Steady Sales

    Simply Wall St·08/07/2026 08:45:52
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    • Cascades Inc. has released its second-quarter 2026 results, reporting sales of CA$1,219 million and net income of CA$21 million, compared with sales of CA$1,187 million and a net loss of CA$3 million in the same quarter a year earlier.
    • Over the first half of 2026, Cascades’ net income rose to CA$60 million from CA$4 million a year ago, with basic earnings per share from continuing operations increasing to CA$0.59 from CA$0.04, highlighting much stronger profitability on broadly unchanged sales.
    • We’ll now examine how this shift from loss to profit, and higher earnings per share, could influence Cascades’ existing investment narrative.

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    Cascades Investment Narrative Recap

    To own Cascades, you have to believe in a steady, efficiency led story in packaging and tissue, driven by cost control and asset optimization rather than rapid sales growth. The latest quarter’s shift to profit supports that narrative in the near term, but it does not remove the key short term risk that weaker North American consumer spending or box demand could still pressure volumes and margins.

    Against this backdrop, the Granby, Quebec tissue converting investment, with capacity of 3 million cases expected online in Q4 2026, stands out as particularly relevant. It reinforces the catalyst of improving tissue mix and volumes, but also ties back to the risk that higher operating and logistics costs could blunt the benefit of new capacity if demand or pricing do not cooperate.

    Yet behind improving earnings, investors should also be aware that rising input costs and transportation pressure could still...

    Read the full narrative on Cascades (it's free!)

    Cascades' narrative projects CA$5.3 billion revenue and CA$269.7 million earnings by 2029. This requires 3.4% yearly revenue growth and about a CA$167.7 million earnings increase from CA$102.0 million today.

    Uncover how Cascades' forecasts yield a CA$14.67 fair value, a 5% downside to its current price.

    Exploring Other Perspectives

    TSX:CAS 1-Year Stock Price Chart
    TSX:CAS 1-Year Stock Price Chart

    The lowest analysts were already cautious, assuming only about 3.2% annual revenue growth and CA$309.3 million earnings by 2029, and they worry that persistent cost inflation could absorb much of Cascades’ efficiency gains, so this profit rebound may or may not shift their more pessimistic view.

    Explore 3 other fair value estimates on Cascades - why the stock might be worth 5% less than the current price!

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.