Packaging (PKG) AI Stock Analysis

• Market Cap: $18.20B
• Dividend Yield: 2.47%
• Average Volume (3M): 735.45K
• Price to Earnings (P/E): 21.2
• Beta (1Y): 0.66
• Revenue Growth: 9.47%
• EPS Growth: 19.37%
• Country: US
• Employees: 15,400
• Sector: Consumer Cyclical
• Sector Strength: 60
• Industry: Packaging & Containers
• EPS (TTM): 2.31
• Shares Outstanding: 89,980,000
• 10 Day Avg. Volume: 786,896
• 30 Day Avg. Volume: 735,448
• PEG Ratio: 2.72
• Price to Book (P/B): 3.81
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 32.35
• Enterprise Value/Market Cap: 1.04
• Enterprise Value/Revenue: 0.59
• Enterprise Value/Gross Profit: 10.60
• Enterprise Value/Ebitda: 3.02
• 1Y Price Target: $217.50
• Price Target Upside: 7.52% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 75 Outperform
• Price Target: $228.00 ▲(12.71%Upside)

Packaging Corporation of America demonstrates strong financial performance and positive strategic initiatives, such as the acquisition of Greif's containerboard business. However, potential risks include cash flow reporting gaps and economic uncertainties. Technical indicators show positive momentum, but the RSI suggests cautious optimism.

Positive Factors

Demand and Growth

PKG's box demand remained strong with bookings and billings up 8% year-over-year, and management is confident of seeing record box shipments.

Financial Strategy

PKG is moving forward with its capital projects and reiterated its capex guidance for 2025, with expectations that capex will decrease in 2026, driving free cash flow growth.

Operational Performance

PKG regularly posts the best volumes and margins in the sector.

Negative Factors

Market Reaction

PKG's 1Q EPS guidance is below Street expectations, which may lead to a neutral or negative market reaction.

Operating Costs

Rising operating costs and maintenance expenses are weighing on earnings and have led to a sell-off.

Weather Impact

Higher than expected operating costs and unusually cold weather have increased costs, contributing to underwhelming guidance.

Packaging Business Overview & Revenue Model

Company Description

Packaging Corporation of America manufactures and sells containerboard and corrugated packaging products in the United States. The company operates through Packaging and Paper segments. The Packaging segment offers various containerboard and corrugated packaging products, such as conventional shipping containers used to protect and transport manufactured goods; multi-color boxes and displays that help to merchandise the packaged product in retail locations; and honeycomb protective packaging products, as well as packaging for meat, fresh fruit and vegetables, processed food, beverages, and other industrial and consumer products. This segment sells its corrugated products through a direct sales and marketing organization, independent brokers, and distribution partners. The Paper segment manufactures and sells commodity and specialty papers, as well as communication papers, including cut-size office papers, and printing and converting papers. This segment sells white papers through its sales and marketing organization. Packaging Corporation of America was founded in 1867 and is headquartered in Lake Forest, Illinois.

How the Company Makes Money

Packaging Corporation of America generates revenue through the manufacturing and sale of its containerboard and corrugated products. The company operates a network of mills and facilities that produce containerboard, which is then converted into corrugated packaging products. These products are sold directly to businesses across various industries, ensuring a steady demand for packaging solutions. Additionally, PKG benefits from its ability to offer customized packaging solutions, which allows it to serve niche markets and provide value-added services. Strategic partnerships with suppliers and distributors further enhance its market reach, supporting consistent revenue growth. The company's focus on sustainability and innovation also positions it favorably in an increasingly eco-conscious market, contributing to its financial success.

Packaging Financial Statement Overview

Summary

Strong revenue growth and stable profitability supported by a robust balance sheet. However, the absence of recent cash flow data presents a potential risk in cash management.

Income Statement

The company has demonstrated strong revenue growth with a 7.44% increase from 2023 to 2024. Gross profit margin is stable at around 21.27%, although there's a slight decline from previous years. Net profit margin improved to 9.61%, indicating efficient cost management. EBIT and EBITDA margins remained robust at approximately 13.14% and 13.14%, respectively, reflecting operational strength.

Balance Sheet

The company's balance sheet shows a strong equity base with a high equity ratio of 49.86%. Debt-to-equity ratio stands at 0.63, suggesting moderate leverage and financial stability. Return on equity decreased slightly to 18.29%, but remains healthy, indicating efficient use of equity to generate profits.

Cash Flow

Free cash flow growth is not calculated due to missing current free cash flow data. Operating cash flow to net income ratio was unavailable for 2024, but previous years indicate strong cash flow generation relative to net income. The lack of reported operating and free cash flow in 2024 presents a risk factor.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	8.38B	7.80B	8.48B	7.73B	6.66B
Gross Profit	1.78B	1.70B	2.09B	1.87B	1.37B
EBITDA	1.63B	1.59B	1.89B	1.68B	1.14B
Net Income	805.10M	765.20M	1.03B	841.10M	461.00M
Balance Sheet
Total Assets	8.83B	8.68B	8.00B	7.84B	7.43B
Cash, Cash Equivalents and Short-Term Investments	787.00M	1.14B	405.20M	704.80M	1.08B
Total Debt	2.77B	3.17B	2.79B	2.73B	2.74B
Total Liabilities	4.43B	4.68B	4.34B	4.23B	4.19B
Stockholders Equity	4.40B	4.00B	3.67B	3.61B	3.25B
Cash Flow
Free Cash Flow	521.50M	845.40M	670.80M	489.00M	611.60M
Operating Cash Flow	1.19B	1.32B	1.50B	1.09B	1.03B
Investing Cash Flow	-277.80M	-875.10M	-833.70M	-794.40M	-426.10M
Financing Cash Flow	-876.40M	-112.00M	-960.00M	-655.60M	-311.60M

Packaging Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 202.29
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PKG, the sentiment is Positive. The current price of 202.29 is above the 20-day moving average (MA) of 191.94, above the 50-day MA of 189.31, and below the 200-day MA of 208.87, indicating a neutral trend. The MACD of 2.08 indicates Negative momentum. The RSI at 67.61 is Neutral, neither overbought nor oversold. The STOCH value of 90.46 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PKG.

Packaging Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PKG	75 Outperform	$18.20B	21.18	20.07%	2.47%	9.47%	19.37%
CCK	70 Outperform	$12.56B	23.19	21.30%	0.97%	0.90%	34.40%
BALL	69 Neutral	$16.29B	31.16	8.23%	1.36%	-9.79%	―
AMCR	67 Neutral	$22.20B	17.28	20.71%	5.26%	-2.29%	24.05%
IP	63 Neutral	$26.62B	43.00	3.01%	3.67%	7.49%	123.95%
SW	63 Neutral	$24.99B	39.31	4.25%	3.59%	―	―
Sector *	62 Neutral	$16.85B	11.50	-7.38%	2.96%	1.59%	-23.36%

Packaging Corporate Events

Packaging Corp Acquires Greif’s Containerboard Business

On June 30, 2025, Packaging Corporation of America entered into a definitive agreement to acquire the containerboard business of Greif, Inc. for $1.8 billion in cash. This acquisition, expected to close in the third quarter of 2025, is subject to customary conditions and regulatory approvals, and includes provisions for termination rights and indemnification, potentially impacting PCA’s market positioning and operational capabilities.

The most recent analyst rating on (PKG) stock is a Hold with a $187.00 price target. To see the full list of analyst forecasts on Packaging stock, see the PKG Stock Forecast page.

Packaging Corporation Acquires Greif’s Containerboard Business

On July 1, 2025, Packaging Corporation of America announced its agreement to acquire the containerboard business of Greif, Inc. for $1.8 billion in cash. The acquisition, expected to close by the end of PCA’s third quarter, includes two containerboard mills and eight sheet feeder and corrugated plants across the U.S., which generated $1.2 billion in sales over the last 12 months. The deal is anticipated to bring $60 million in pre-tax synergies through operational efficiencies and increased integration, enhancing PCA’s growth strategy and shareholder value. The acquisition will be financed with $1.5 billion in new debt and cash, and is expected to be immediately accretive to earnings, with PCA’s pro forma leverage ratio estimated at 1.7X post-transaction.

The most recent analyst rating on (PKG) stock is a Hold with a $187.00 price target. To see the full list of analyst forecasts on Packaging stock, see the PKG Stock Forecast page.

Packaging Corporation Approves Key Proposals at Annual Meeting

On May 7, 2025, Packaging Corporation of America (PCA) conducted its 2025 Annual Meeting of Stockholders, where several key proposals were approved. These included the election of directors, ratification of KPMG LLP as the independent registered public accounting firm, and approval of executive compensation. The outcomes of these votes are likely to influence PCA’s corporate governance and operational strategies moving forward.

The most recent analyst rating on (PKG) stock is a Hold with a $187.00 price target. To see the full list of analyst forecasts on Packaging stock, see the PKG Stock Forecast page.