Pack Corporation (3950) AI Stock Analysis

• Market Cap: ¥78.67B
• Dividend Yield: 6.64%
• Average Volume (3M): 96.67K
• Price to Earnings (P/E): 12.5
• Beta (1Y): 0.56
• Revenue Growth: 2.85%
• EPS Growth: -9.13%
• Country: JP
• Employees: 1,196
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Packaging & Containers
• EPS (TTM): 46.00
• Shares Outstanding: 59,700,000
• 10 Day Avg. Volume: 87,040
• 30 Day Avg. Volume: 96,670
• PEG Ratio: -3.29
• Price to Book (P/B): 0.94
• Price to Sales (P/S): 0.70
• P/FCF Ratio: 17.85
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: ¥1,469.00 ▲(14.14% Upside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven primarily by strong financial performance—especially the very conservative balance sheet and improved profitability—partly tempered by uneven cash-flow consistency and questions around the durability of 2025’s unusually large revenue jump. Valuation is supportive with a moderate P/E and solid dividend yield, while technical indicators are mixed, reflecting a longer-term uptrend with near-term neutrality.

Positive Factors

Very conservative balance sheet

Extremely low leverage materially reduces solvency risk and preserves financial optionality. A conservative balance sheet supports durable capital allocation flexibility—funding capex, dividends, or opportunistic M&A—especially valuable in the cyclical packaging industry over the next several quarters.

Steady revenue expansion and improving profitability

Multi-year topline growth with rising net margins signals improving business mix or cost control, enhancing earnings resilience. Stable gross margins in the mid‑20% range and higher ROE over time point to structural improvement in capital efficiency that should persist beyond short-term cycles.

Positive free cash flow rebound

A strong FCF rebound to ~4.1B in 2025 demonstrates the company's ability to convert earnings into cash, supporting dividends, debt-light financing, and reinvestment. This cash-generation capacity is a durable structural strength despite episodic volatility in prior years.

Negative Factors

Volatile free cash flow history

Intermittent negative FCF and wide swings in cash conversion suggest working-capital sensitivity or lumpy investments. Persistent volatility can undermine reliable funding for growth, dividends, or buybacks, raising operational and planning risk over the medium term.

Unusually large 2025 revenue jump may not be durable

An 87.6% revenue surge in one year paired with margin compression implies mix shifts or non-recurring drivers. If the jump reflects one-off items or pricing mix, future topline and margin normalization could erode expected earnings durability and complicate medium-term forecasting.

Increase in total debt in 2025

While leverage stays very low, the recent uptick in debt amid prior cash-flow variability is notable. Repeated debt increases could reduce the current financial cushion and limit strategic flexibility if cash generation weakens, making balance-sheet trends worth monitoring.

Pack Corporation Business Overview & Revenue Model

Company Description

The Pack Corporation manufactures and sells paper packaging products in Japan and internationally. The company offers paper bags, plastic bags, parcel delivery bags, sewn bags, garment bags, and other bags; paper boxes, paper trays, clear cases, and other types of boxes in various shapes; and corrugated shipping boxes, large corrugated boxes for packing major appliances, and cushioning materials. It also provides gift boxes, drawstring bags, wrapping papers, seals, tags, ribbons, and other products for store supplies; film and flexible packaging products for food products, daily necessities, hygiene products, pharmaceuticals, and other product categories; and eco products. In addition, the company offers offset rotary printing and gravure printing services for shopping bags, decorative corrugated boards, paper containers, and other products; and printing services for paper containers, paper bags, wrapping papers, posters, pamphlets, flyers, product catalogs, magazines, books, shopping bags, packaging, seals, and others. The Pack Corporation was founded in 1878 and is headquartered in Osaka, Japan.

How the Company Makes Money

Pack Corporation makes money primarily through the manufacturing and sales of its diverse range of packaging products. The company's revenue model is based on selling packaging materials to businesses across multiple industries, including food and beverage, consumer goods, and industrial sectors. Key revenue streams include the sale of both standard and customized packaging solutions. Significant factors contributing to its earnings include a strong focus on sustainability, which attracts environmentally conscious clients, and strategic partnerships with major corporations that require consistent and reliable packaging supplies. Additionally, the company's investment in research and development drives innovation, allowing it to maintain a competitive edge and cater to the evolving market demands.

Pack Corporation Financial Statement Overview

Summary

Strong overall fundamentals led by an exceptionally low-leverage balance sheet and improving profitability over multiple years. Offsetting factors include volatile free cash flow (notably negative in 2023) and uncertainty around the sustainability of the outsized 2025 revenue jump alongside slightly softer margins vs. 2024.

Income Statement

Revenue has expanded steadily from 2021–2025, with profitability improving versus earlier years (net margin rising from ~3.5% in 2021 to ~5.8% in 2025). Gross margin has been relatively stable in the mid‑20% range, supporting consistent earnings generation. The key watch-out is 2025’s unusually high revenue growth (87.6%) alongside slightly lower margins versus 2024, which suggests potential mix/price pressure or non-recurring factors despite the topline jump.

Balance Sheet

The balance sheet is very conservatively financed: debt is minimal relative to equity (debt-to-equity ~0.1%–0.6% across the period), which materially lowers solvency risk and gives flexibility in a cyclical packaging environment. Equity has grown over time, and returns on equity improved from ~4.0% (2020) to ~8.5% (2024), indicating better capital efficiency. A minor concern is the increase in total debt in 2025 versus 2024, though leverage remains extremely low overall.

Cash Flow

Cash generation is generally solid, with positive free cash flow in most years and a strong rebound by 2025 (free cash flow ~4.1B). However, cash flow has been volatile: free cash flow turned meaningfully negative in 2023, and cash conversion is not consistently strong (free cash flow to net income ranges from negative in 2023 to ~0.59 in 2025). Operating cash flow has improved versus 2023, but the variability suggests working-capital swings and/or uneven investment needs.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	102.23B	103.13B	101.46B	97.71B	89.06B	80.18B
Gross Profit	24.84B	25.45B	25.60B	24.77B	21.68B	19.01B
EBITDA	9.97B	10.16B	10.43B	10.02B	7.92B	6.24B
Net Income	5.75B	6.02B	6.32B	5.65B	4.06B	2.82B
Balance Sheet
Total Assets	98.53B	104.21B	103.29B	98.85B	94.36B	87.42B
Cash, Cash Equivalents and Short-Term Investments	26.39B	26.06B	23.67B	24.42B	28.66B	27.08B
Total Debt	521.00M	462.00M	82.00M	34.00M	59.00M	85.00M
Total Liabilities	23.42B	27.21B	28.81B	27.69B	29.00B	25.39B
Stockholders Equity	75.11B	77.00B	74.48B	71.16B	65.37B	62.02B
Cash Flow
Free Cash Flow	0.00	4.07B	2.33B	-2.84B	1.84B	3.48B
Operating Cash Flow	0.00	6.86B	7.10B	4.44B	5.38B	7.22B
Investing Cash Flow	0.00	3.51B	-5.44B	-3.96B	-3.76B	-3.46B
Financing Cash Flow	0.00	-3.55B	-3.04B	-1.41B	-1.12B	-1.03B

Pack Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1287.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3950, the sentiment is Positive. The current price of 1287 is below the 20-day moving average (MA) of 1321.65, below the 50-day MA of 1302.43, and above the 200-day MA of 1180.62, indicating a bullish trend. The MACD of 5.62 indicates Positive momentum. The RSI at 58.01 is Neutral, neither overbought nor oversold. The STOCH value of 66.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3950.

Pack Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5901	79 Outperform	¥549.06B	13.65	6.55%	2.71%	-0.06%	137.47%
7917	77 Outperform	¥118.55B	14.56	7.53%	3.01%	5.44%	45.99%
3950	76 Outperform	¥78.67B	12.49	―	6.64%	2.85%	-9.13%
7942	73 Outperform	¥86.92B	13.19	―	3.31%	0.83%	-9.16%
7864	70 Outperform	¥157.69B	7.06	10.46%	2.35%	4.56%	49.23%
4248	66 Neutral	¥11.19B	13.97	―	4.20%	-5.73%	20.76%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Pack Corporation Corporate Events

The Pack Corporation Posts Profit Decline Despite Higher Sales, Guides Cautious 2026

The Pack Corporation reported a 1.6% rise in net sales to ¥103.1 billion for the year ended December 31, 2025, but operating profit fell 10% and profit attributable to owners of parent declined 4.6%, reflecting margin pressure despite revenue growth. Equity strengthened with a higher equity-to-asset ratio of 73.9% and cash and cash equivalents surged to ¥23.6 billion, while the company executed a three-for-one stock split and maintained an active dividend policy.

For fiscal 2026, the company forecasts further growth in net sales to ¥106 billion and a recovery in operating profit to ¥7.5 billion, even as it guides for a 12% drop in profit attributable to owners of parent, implying higher costs or strategic investments ahead. Dividend guidance of ¥42 per share post-split signals continued shareholder returns, while increased treasury share holdings and changes in accounting policies may influence capital structure and reported metrics for investors.

The most recent analyst rating on (JP:3950) stock is a Buy with a Yen1472.00 price target. To see the full list of analyst forecasts on Pack Corporation stock, see the JP:3950 Stock Forecast page.