Latest news with #PKG
Yahoo
01-08-2025
- Business
- Yahoo
Q2 2025 earnings releases signal strategic shift in packaging
The second-quarter earnings season has unveiled a clear message from the packaging sector: the industry is not shrinking—it is recalibrating. In the face of macroeconomic headwinds, shifting consumer sentiment, and regulatory upheaval, major players are showing a notable ability to adapt, streamline, and position themselves for medium-term growth. Volume pressure meets strategic pricing Companies like Packaging Corporation of America (PKG) and Graphic Packaging Holding Company (GPK) reported modest revenue contractions compared to last year—yet both beat analyst expectations. PKG posted $242 million in net income, and GPK maintained net sales above $2.2 billion. While top-line growth was subdued, margins held firm, thanks to pricing discipline and operational efficiencies. This reflects a wider industry pivot from volume-led growth to profitability-first strategies. Portfolio focus: specialty and performance packaging TriMas Corporation stood out with a 14.2% YoY increase in net sales, citing strong growth in both its Packaging and Aerospace segments. The company's emphasis on dispensing systems, closures, and industrial applications reflects a broader move toward value-added, specialized packaging—an area relatively insulated from commodity price volatility and volume swings. This focus echoes trends seen across the sector: premium packaging, sustainability-enhancing designs, and customizable formats are attracting capital even as commodity corrugated and flexible packaging face flattening demand. Regulation and resilience A significant undercurrent in all Q2 disclosures is the looming impact of Extended Producer Responsibility (EPR) regulations in the U.S. and Europe. Although not directly quantified in earnings reports, the shift is already influencing strategic priorities—particularly in areas like material recyclability, design-for-circularity, and supply chain traceability. Executives at GPK and TriMas pointed to investments in sustainable substrates and process innovations aimed at meeting upcoming compliance thresholds. The earnings stability of these companies may, in part, reflect early-mover advantages in this regulatory transition. Caution from chemicals Outside core packaging firms, Dow Inc., which provides essential packaging materials, posted a Q2 loss and halved its dividend. While its packaging and specialty plastics segment remains the company's largest, an 8.9% revenue decline underscores the vulnerability of upstream material suppliers to pricing softness and global demand shifts—especially as brands recalibrate toward bio-based and recycled materials. What the numbers suggest Earnings this quarter tell a nuanced story: while the packaging sector is not booming, it is stable, cash-generative, and strategically shifting. The divergence between commodity-focused suppliers and value-driven manufacturers signals a sector that is undergoing internal transformation—one shaped by environmental mandates, evolving customer demands, and a global rethinking of waste. For investors and industry watchers, the message is clear: leaner, more agile packaging firms with sustainable portfolios are emerging as long-term winners, even in a low-growth environment. The takeaway Q2 2025 earnings illustrate a packaging industry at an inflection point. The winners are those who can align financial resilience with regulatory readiness and product differentiation. As this transformation accelerates, the next quarters may not just show who can survive—but who is best positioned to lead the new era of packaging. "Q2 2025 earnings releases signal strategic shift in packaging" was originally created and published by Packaging Gateway, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
24-07-2025
- Business
- Yahoo
Packaging Corporation of America (NYSE:PKG) Misses Q2 Revenue Estimates
Packaging Corporation of America (NYSE:PKG) missed Wall Street's revenue expectations in Q2 CY2025 as sales rose 4.6% year on year to $2.17 billion. Its non-GAAP profit of $2.48 per share was 1.5% above analysts' consensus estimates. Is now the time to buy Packaging Corporation of America? Find out in our full research report. Packaging Corporation of America (PKG) Q2 CY2025 Highlights: Revenue: $2.17 billion vs analyst estimates of $2.19 billion (4.6% year-on-year growth, 0.8% miss) Adjusted EPS: $2.48 vs analyst estimates of $2.44 (1.5% beat) Adjusted EBITDA: $450.8 million vs analyst estimates of $447.3 million (20.8% margin, 0.8% beat) Operating Margin: 15.4%, up from 13.3% in the same quarter last year Sales Volumes fell 6.7% year on year (15.2% in the same quarter last year) Market Capitalization: $18.34 billion Commenting on reported results, Mark W. Kowlzan, Chairman and CEO, said, 'We operated very well during the quarter, delivering strong earnings and cash flows as well as higher margins in the Packaging segment. Pricing in the Packaging segment was consistent with expectations as we fully realized our earlier announced price increases. Despite cautious ordering patterns from customers, corrugated products volume was solid and steady throughout the quarter, with per day shipments exceeding the second quarter of 2024 and the first quarter of 2025. As expected, export containerboard sales were lower. We ran our containerboard mills to meet demand and drew down inventory to end at targeted levels. The Paper segment delivered another profitable quarter with strong margin performance, as we realized our earlier price increases. We continued to successfully manage costs across all of our operations, executing our capital projects and efficiency initiatives, which have helped offset inflation.' Company Overview Founded in 1959, Packaging Corporation of America (NYSE: PKG) produces containerboard and corrugated packaging products as well as displays and package protection. Revenue Growth A company's long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Unfortunately, Packaging Corporation of America's 5.2% annualized revenue growth over the last five years was tepid. This was below our standard for the industrials sector and is a rough starting point for our analysis. Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. Packaging Corporation of America's recent performance shows its demand has slowed as its annualized revenue growth of 3.7% over the last two years was below its five-year trend. We also note many other Industrial Packaging businesses have faced declining sales because of cyclical headwinds. While Packaging Corporation of America grew slower than we'd like, it did do better than its peers. We can better understand the company's revenue dynamics by analyzing its number of units sold, which reached 1.2 million in the latest quarter. Over the last two years, Packaging Corporation of America's units sold averaged 9.1% year-on-year growth. Because this number is better than its revenue growth, we can see the company's average selling price decreased. This quarter, Packaging Corporation of America's revenue grew by 4.6% year on year to $2.17 billion, falling short of Wall Street's estimates. Looking ahead, sell-side analysts expect revenue to grow 6.4% over the next 12 months. While this projection implies its newer products and services will fuel better top-line performance, it is still below average for the sector. Software is eating the world and there is virtually no industry left that has been untouched by it. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming. Click here to access a free report on our 3 favorite stocks to play this generational megatrend. Operating Margin Operating margin is a key measure of profitability. Think of it as net income - the bottom line - excluding the impact of taxes and interest on debt, which are less connected to business fundamentals. Packaging Corporation of America has been an efficient company over the last five years. It was one of the more profitable businesses in the industrials sector, boasting an average operating margin of 14.6%. This result was particularly impressive because of its low gross margin, which is mostly a factor of what it sells and takes huge shifts to move meaningfully. Companies have more control over their operating margins, and it's a show of well-managed operations if they're high when gross margins are low. Looking at the trend in its profitability, Packaging Corporation of America's operating margin rose by 1.3 percentage points over the last five years, as its sales growth gave it operating leverage. Its expansion was impressive, especially when considering the cycle turned in the wrong direction and most of its Industrial Packaging peers observed plummeting revenue and margins. This quarter, Packaging Corporation of America generated an operating margin profit margin of 15.4%, up 2.1 percentage points year on year. The increase was encouraging, and because its operating margin rose more than its gross margin, we can infer it was more efficient with expenses such as marketing, R&D, and administrative overhead. Earnings Per Share Revenue trends explain a company's historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions. Packaging Corporation of America's EPS grew at a decent 8.8% compounded annual growth rate over the last five years, higher than its 5.2% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded. We can take a deeper look into Packaging Corporation of America's earnings quality to better understand the drivers of its performance. As we mentioned earlier, Packaging Corporation of America's operating margin expanded by 1.3 percentage points over the last five years. On top of that, its share count shrank by 5%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth. Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business. For Packaging Corporation of America, its two-year annual EPS growth of 1.1% was lower than its five-year trend. We hope its growth can accelerate in the future. In Q2, Packaging Corporation of America reported EPS at $2.48, up from $2.20 in the same quarter last year. This print beat analysts' estimates by 1.5%. Over the next 12 months, Wall Street expects Packaging Corporation of America's full-year EPS of $9.91 to grow 8.3%. Key Takeaways from Packaging Corporation of America's Q2 Results It was good to see Packaging Corporation of America narrowly top analysts' EBITDA expectations this quarter. On the other hand, its sales volume missed and its revenue fell slightly short of Wall Street's estimates. Overall, this was a softer quarter. The stock remained flat at $207.88 immediately following the results. So do we think Packaging Corporation of America is an attractive buy at the current price? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here, it's free. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
17-07-2025
- Business
- Yahoo
Packaging Corp Stock Set to Report Q2 Earnings: What to Expect?
Packaging Corporation of America PKG is set to release second-quarter 2025 results on July 23, after the closing Zacks Consensus Estimate for PKG's second-quarter revenues is pegged at $2.16 billion, indicating 4.1% growth from the year-ago reported consensus estimate for earnings is pegged at $2.44 per share. The Zacks Consensus Estimate for PKG's second-quarter earnings has moved 0.4% north in the past 60 days. The estimate indicates year-over-year growth of 10.9%. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.) Image Source: Zacks Investment Research PKG's Earnings Surprise History Packaging Corp's earnings beat the Zacks Consensus Estimates in three of the trailing four quarters and missed in one, the average surprise being 3.4%. Image Source: Zacks Investment Research What the Zacks Model Unveils for Packaging Corp Our model predicts an earnings beat for PKG this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is precisely the case here, as you can see can uncover the best stocks before they are reported with our Earnings ESP ESP: Packaging Corp has an Earnings ESP of +0.77%.Zacks Rank: PKG currently carries a Zacks Rank of 3. Factors Likely to Have Shaped PKG's Q2 Performance Packaging Corp's second-quarter results are expected to reflect the impacts of lower containerboard volume. The price and mix impacts for the Packaging segment are expected to be favorable at 1.5% for the quarter, per our in the Packaging segment is expected to have been strong in the second quarter. Our model predicts the Packaging segment's volume to increase 2.7% year over year in the quarter to be reported, indicating stable packaging estimate for the segment's quarterly revenues is pegged at $1.99 billion, suggesting growth of 4.2% from the year-ago quarter's reported number. Our model estimates the segment's operating income at $291 million, indicating growth of 4% from the prior-year reported the Paper segment, prices and mix are expected to have increased 1% year over year. We expect volume to dip 7.9% year over year. The estimate for the Paper segment's revenues is pegged at $140 million for the June-end quarter, suggesting a dip of 6.9% from the year-ago reported figure. The estimate for the segment's operating income is $46 million, indicating a 75% rise from the prior-year quarter's actual. Packaging Corp's Stock Price Performance Over the past year, PKG shares have gained 7.7% against the industry's 7.1% fall. Image Source: Zacks Investment Research Stocks That Warrant a Look Here are some companies with the right combination of elements to post an earnings beat in their upcoming Electric Co. EMR, expected to release earnings on Aug 6, currently has an Earnings ESP of +0.46% and a Zacks Rank of 3. You can see the complete list of today's Zacks #1 Rank stocks here. The consensus estimate for Emerson Electric's earnings for the third quarter of fiscal 2025 is pegged at $1.51 per share, indicating year-over-year growth of 5.6%. EMR has a trailing four-quarter average surprise of 3.4%.Illinois Tool Works Inc. ITW, slated to release second-quarter 2025 results on July 30, has an Earnings ESP of +0.97% and a Zacks Rank of 3 at Zacks Consensus Estimate for Illinois Tool Works' second-quarter 2025 earnings is pegged at $2.55 per share, suggesting a year-over-year rise of 0.4%. ITW has a trailing four-quarter average surprise of 3%.Crown Holdings, Inc. CCK is scheduled to release second-quarter 2025 results on July 21. It currently has an Earnings ESP of +0.27% and a Zacks Rank of Zacks Consensus Estimate for Crown Holdings' earnings is pegged at $1.86 per share, which indicates a year-over-year increase of 2.8%. CCK has a trailing four-quarter average surprise of 16.3%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Illinois Tool Works Inc. (ITW) : Free Stock Analysis Report Emerson Electric Co. (EMR) : Free Stock Analysis Report Packaging Corporation of America (PKG) : Free Stock Analysis Report Crown Holdings, Inc. (CCK) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
Yahoo
04-07-2025
- Business
- Yahoo
Packaging Corporation of America's Quarterly Earnings Preview: What You Need to Know
Valued at $18.2 billion by market cap, Packaging Corporation of America (PKG), based in Lake Forest, Illinois, operates as a leading U.S. producer of containerboard and corrugated packaging. Operating through its Packaging and Paper segments, PKG provides essential products like shipping containers and protective packaging to industries such as food, beverages, and industrial goods. The packaging giant is expected to announce its second-quarter results after the markets close on Wednesday, Jul. 23. Ahead of the event, analysts expect PKG to deliver an adjusted earnings of $2.43 per share, up 10.5% from $2.20 per share reported in the year-ago quarter. While the company has missed the Street's bottom-line estimates once over the past four quarters, it has surpassed the expectations on three other occasions. Michael Saylor Says 'You'll Wish You'd Bought More' Bitcoin as MicroStrategy Doubles Down Is Microsoft Stock About to Go Nuclear? Is Super Micro Computer Stock a Buy, Sell, or Hold for July 2025? Stop Missing Market Moves: Get the FREE Barchart Brief – your midday dose of stock movers, trending sectors, and actionable trade ideas, delivered right to your inbox. Sign Up Now! Furthermore, for the full fiscal 2025, PKG's earnings are expected to grow to $10.35 per share, up a notable 14.5% from $9.04 per share in fiscal 2024. Moreover, its earnings are expected to further grow 9.8% year-over-year to $10.35 per share in fiscal 2026. Packaging Corp. has gained 13.8% over the past 52-week period, underperforming the Consumer Discretionary Select Sector SPDR Fund's (XLY) 17.9% surge but slightly outpacing the S&P 500 Index's ($SPX) 13% gains during the same time frame. Despite reporting better-than-expected financials, PKG stock prices observed a marginal dip in the trading session after the release of its Q1 results on Apr. 22. The company's packaging sales experienced a solid boost during the quarter, leading to its net sales growing 8.2% year-over-year to $2.1 billion, surpassing the Street's expectations by a thin margin. Meanwhile, driven by a favorable pricing mix, its margins observed a significant expansion. This led to its adjusted EPS soaring 34.3% year-over-year to $2.31, exceeding the consensus estimates by 4.5%. Following the initial dip, PKG stock prices rose 2.2% in the subsequent trading session. The stock holds a consensus 'Moderate Buy' rating overall. Of the eight analysts covering the PKG stock, opinions include three 'Strong Buys' and five 'Holds.' Its mean price target of $210.22 suggests a modest 4.1% upside potential. On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on
Yahoo
03-07-2025
- Business
- Yahoo
Here's Why Packaging Corp. (PKG) is a Strong Momentum Stock
Taking full advantage of the stock market and investing with confidence are common goals for new and old investors alike. While you may have an investing style you rely on, finding great stocks is made easier with the Zacks Style Scores. These are complementary indicators that rate stocks based on value, growth, and/or momentum characteristics. For momentum investors, upward or downward trends in a stock's price or earnings outlook take precedent, so they'll want to zero in on the Momentum Style Score. This Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates. Headquartered at Lake Forest, IL, Packaging Corporation of America is the third largest producer of containerboard products and a leading producer of uncoated freesheet paper in North America. The company operates eight mills and 86 corrugated products manufacturing plants. PKG is a Zacks Rank #3 (Hold) stock, with a Momentum Style Score of B and VGM Score of A. Shares are up 8.1% over the past one week and up 4.5% over the past four weeks. PKG has gained 12.5% in the last one-year period as well. Looking at trading volume, an average of 714,641 shares exchanged hands over the last 20 trading days. A company's earnings performance is important for momentum investors as well. For fiscal 2025, one analyst revised their earnings estimate higher in the last 60 days for PKG, while the Zacks Consensus Estimate has increased $0.08 to $10.35 per share. PKG also boasts an average earnings surprise of 3.4%. Investors should take the time to consider PKG for their portfolios due to its solid Zacks Ranks, notable earnings metrics, and impressive Momentum and VGM Style Scores. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Packaging Corporation of America (PKG) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
