Want to see PKG full AI Analyst Report?
Top Page
Packaging
(NYSE:PKG)
Select Model
Select Model
Rating:69Neutral
Price Target:
$262.00
â–²(6.27% Upside)
Action:Downgraded
Date:10/22/26
PKG scores as a solid, above-average setup driven by steady financial performance and strong cash generation, supported by constructive technicals and a positive earnings call (pricing progress and Greif synergies ahead of plan). The key offsets are a higher valuation (P/E ~30.9), margin/ROE below prior-cycle peaks, and a notable rise in leverage that increases sensitivity to ongoing cost pressure and outage impacts.
Positive Factors
Strong cash generation
Robust operating and free cash flow gives PKG internal funding for maintenance, capacity expansion, dividends, and strategic initiatives. Positive cash-flow growth also strengthens resilience when input costs rise, while cash generation comfortably supports ongoing investment in the business.
Negative Factors
Meaningfully higher leverage
The sharp increase in debt reduces financial flexibility compared with 2024 and makes earnings more sensitive to operating volatility. Higher leverage can also constrain capital allocation, increase interest burden, and limit room to absorb prolonged margin pressure or weaker demand.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Robust operating and free cash flow gives PKG internal funding for maintenance, capacity expansion, dividends, and strategic initiatives. Positive cash-flow growth also strengthens resilience when input costs rise, while cash generation comfortably supports ongoing investment in the business.
Read all positive factors
Packaging Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down sales across different business units, revealing which segments contribute most to growth and where there might be challenges or opportunities.
Breaks down sales across different business units, revealing which segments contribute most to growth and where there might be challenges or opportunities.
Data provided by:
The Fly
The FlyPackaging (PKG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$21.29B
Dividend Yield2.3%
Average Volume (3M)603.55K
Price to Earnings (P/E)30.9
Beta (1Y)0.59
Revenue Growth10.35%
EPS Growth-23.16%
CountryUS
Employees16,800
SectorConsumer Cyclical
Sector Strength84
IndustryPackaging & Containers
Share Statistics
EPS (TTM)7.73
Shares Outstanding89,098,300
10 Day Avg. Volume597,029
30 Day Avg. Volume603,548
Financial Highlights & Ratios
PEG Ratio-5.53
Price to Book (P/B)4.02
Price to Sales (P/S)2.06
P/FCF Ratio25.36
Enterprise Value/Market Cap1.18
Enterprise Value/Revenue2.62
Enterprise Value/Gross Profit13.05
Enterprise Value/Ebitda13.51
Forecast
1Y Price Target
$276.83Price Target Upside12.29% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)10.45
Revenue Forecast (FY)$10.08B
Packaging Business Overview & Revenue Model
Company Description
Packaging Corporation of America (PCA) is a U.S.-based enterprise specializing in the production and sale of containerboard and corrugated packaging materials. Its operations are organized into two primary divisions: Packaging and Paper. The Packa...
How the Company Makes Money
Packaging Corporation of America primarily makes money by manufacturing and selling (1) containerboard and (2) corrugated packaging products and related services. In its Packaging segment, PKG converts containerboard into corrugated products—most ...
Packaging Earnings Call Summary
Earnings Call Date:Oct 21, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Jan 27, 2027
Earnings Call Sentiment Positive
The call was predominantly positive. PCA reported year-over-year growth in net income, sales, EBITDA, Packaging margins, pricing, cash flow, and Greif integration, exceeded third-quarter guidance, and described demand, operational performance, synergies, and capacity expansion opportunities favorably. The main challenges were higher input and capital costs, maintenance outages, lower agriculture and protein volumes, lower export volumes, a weaker Paper segment comparison, and fourth-quarter earnings expected at $2.81 per share excluding special items. Overall, the highlights significantly outweighed the lowlights.Positive Updates
Year-over-Year Earnings and Revenue Growth
Third quarter 2026 net income was $262 million, or $2.93 per share, while net income excluding special items was $272 million, or $3.4 per share, compared with $247 million, or $2.73 per share, in the third quarter of 2025. Net sales increased to $2.6 billion from $2.3 billion, and total company EBITDA excluding special items increased to $577 million from $503 million.
Negative Updates
Higher Operating and Input Costs
Third-quarter earnings were partially offset by higher labor and operating costs of $0.28 per share, higher freight costs of $0.26, higher corporate and other expenses of $0.13, higher fiber costs of $0.12, higher depreciation and amortization expenses of $0.06, higher paper-segment maintenance outage expenses of $0.04, and higher interest expense of $0.01. Management also reported significant increases in recycled fiber, purchased power, and chemical costs and expects these input costs to continue to go up.
Read all updates
Q3-2026 Updates
Positive
Negative
Year-over-Year Earnings and Revenue Growth
Third quarter 2026 net income was $262 million, or $2.93 per share, while net income excluding special items was $272 million, or $3.4 per share, compared with $247 million, or $2.73 per share, in the third quarter of 2025. Net sales increased to $2.6 billion from $2.3 billion, and total company EBITDA excluding special items increased to $577 million from $503 million.
Read all positive updates
Company Guidance
For the fourth quarter, PCA expects earnings of $2.81 per share, excluding special items; solid corrugated products demand with some seasonal improvement; shipments per day at or around last year's fourth quarter level, with 2 fewer shipping days than the third quarter and total corrugated shipments higher than the third quarter; prices for containerboard and corrugated products to improve, corrugated products mix to be seasonally weaker with higher ecommerce volumes, containerboard production to be lower with annual maintenance outages at 3 mills, and outage expense of $0.72, totaling $1.48 for the year; paper volume to be seasonally lower with slightly higher prices; freight, recycled fiber, wood fiber, chemicals, and energy costs to increase; a fourth-quarter tax rate nearly identical to the third quarter’s 25%; 2026 CapEx of $865 million to $890 million and depreciation and amortization excluding special items just above $705 million; and the remaining realization of the second $50 increase almost all in the fourth quarter, while realization of the $70 increase will be split between Q4 and Q1 and skewed more towards Q1 in terms of timing, with the great majority of the realization in the first quarter next year.Packaging Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
64
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 9.53B | 8.99B | 8.38B | 7.80B | 8.48B | 7.73B |
| Gross Profit | 1.92B | 1.89B | 1.78B | 1.70B | 2.09B | 1.87B |
| EBITDA | 1.85B | 1.76B | 1.63B | 1.59B | 1.89B | 1.68B |
| Net Income | 691.00M | 768.90M | 805.10M | 765.20M | 1.03B | 841.10M |
Balance Sheet | ||||||
| Total Assets | 11.02B | 10.92B | 8.83B | 8.68B | 8.00B | 7.84B |
| Cash, Cash Equivalents and Short-Term Investments | 593.80M | 600.80M | 787.00M | 1.14B | 405.20M | 704.80M |
| Total Debt | 4.40B | 4.36B | 2.77B | 3.17B | 2.79B | 2.73B |
| Total Liabilities | 6.35B | 6.33B | 4.43B | 4.68B | 4.34B | 4.23B |
| Stockholders Equity | 4.66B | 4.60B | 4.40B | 4.00B | 3.67B | 3.61B |
Cash Flow | ||||||
| Free Cash Flow | 742.40M | 728.60M | 521.50M | 845.40M | 670.80M | 489.00M |
| Operating Cash Flow | 1.62B | 1.56B | 1.19B | 1.32B | 1.50B | 1.09B |
| Investing Cash Flow | -2.76B | -2.57B | -277.80M | -875.10M | -833.70M | -794.40M |
| Financing Cash Flow | 794.20M | 859.40M | -876.40M | -112.00M | -960.00M | -655.60M |
Packaging Technical Analysis
Positive
246.54
Price Trends
236.87
Positive
235.44
Positive
225.77
Positive
Market Momentum
0.31
Negative
59.24
Neutral
87.16
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 246.54 is above the 20-day moving average (MA) of 232.48, above the 50-day MA of 236.87, and above the 200-day MA of 225.77, indicating a bullish trend. The MACD of 0.31 indicates Negative momentum. The RSI at 59.24 is Neutral, neither overbought nor oversold. The STOCH value of 87.16 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PKG.
Packaging Risk Analysis
Packaging disclosed 19 risk factors in its most recent earnings report. Packaging reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Packaging Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $12.64B | 16.12 | 27.10% | 1.13% | 13.83% | -11.08% | |
69 Neutral | $21.29B | 30.93 | 14.86% | 2.30% | 10.35% | -23.16% | |
68 Neutral | $16.98B | 18.17 | 17.04% | 1.25% | 16.86% | 64.01% | |
65 Neutral | $20.68B | 16.91 | 9.49% | 5.74% | 56.62% | 32.08% | |
62 Neutral | $21.54B | 43.64 | 2.68% | 4.31% | 1.69% | 42.09% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
49 Neutral | $17.84B | -5.16 | -22.39% | 5.50% | 10.34% | -7165.92% |
* Consumer Cyclical Sector Average
PKG
Packaging
239.00
31.01
14.91%
BALL
Ball
64.15
15.14
30.88%
CCK
Crown Holdings
116.22
18.46
18.88%
IP
International Paper Co
33.63
-13.15
-28.12%
SW
Smurfit Westrock
41.46
0.19
0.47%
AMCR
Amcor
45.27
6.48
16.70%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.