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PACKAGING CORP OF AMERICA (PKG)

US6951561090 - Common Stock

163.88  -0.44 (-0.27%)

After market: 163.88 0 (0%)

Fundamental Rating

6

We assign a fundamental rating of 6 out of 10 to PKG. PKG was compared to 23 industry peers in the Containers & Packaging industry. PKG scores excellent points on both the profitability and health parts. This is a solid base for a good stock. PKG is valued expensive and it does not seem to be growing.



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8

1. Profitability

1.1 Basic Checks

In the past year PKG was profitable.
PKG had a positive operating cash flow in the past year.
Each year in the past 5 years PKG has been profitable.
PKG had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

With an excellent Return On Assets value of 9.55%, PKG belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
PKG has a better Return On Equity (20.10%) than 69.57% of its industry peers.
Looking at the Return On Invested Capital, with a value of 12.56%, PKG belongs to the top of the industry, outperforming 95.65% of the companies in the same industry.
PKG had an Average Return On Invested Capital over the past 3 years of 13.05%. This is above the industry average of 8.35%.
Industry RankSector Rank
ROA 9.55%
ROE 20.1%
ROIC 12.56%
ROA(3y)9.86%
ROA(5y)10.05%
ROE(3y)21.7%
ROE(5y)23%
ROIC(3y)13.05%
ROIC(5y)13.18%

1.3 Margins

PKG has a Profit Margin of 9.96%. This is amongst the best in the industry. PKG outperforms 100.00% of its industry peers.
In the last couple of years the Profit Margin of PKG has grown nicely.
PKG has a Operating Margin of 14.60%. This is amongst the best in the industry. PKG outperforms 95.65% of its industry peers.
PKG's Operating Margin has improved in the last couple of years.
PKG's Gross Margin of 22.17% is fine compared to the rest of the industry. PKG outperforms 60.87% of its industry peers.
PKG's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 14.6%
PM (TTM) 9.96%
GM 22.17%
OM growth 3Y3.85%
OM growth 5Y3.42%
PM growth 3Y6.69%
PM growth 5Y3.22%
GM growth 3Y1.47%
GM growth 5Y1.54%

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9

2. Health

2.1 Basic Checks

PKG has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for PKG has been reduced compared to 1 year ago.
PKG has less shares outstanding than it did 5 years ago.
PKG has a better debt/assets ratio than last year.

2.2 Solvency

PKG has an Altman-Z score of 4.27. This indicates that PKG is financially healthy and has little risk of bankruptcy at the moment.
PKG's Altman-Z score of 4.27 is amongst the best of the industry. PKG outperforms 95.65% of its industry peers.
PKG has a debt to FCF ratio of 3.03. This is a good value and a sign of high solvency as PKG would need 3.03 years to pay back of all of its debts.
PKG has a Debt to FCF ratio of 3.03. This is amongst the best in the industry. PKG outperforms 95.65% of its industry peers.
PKG has a Debt/Equity ratio of 0.54. This is a neutral value indicating PKG is somewhat dependend on debt financing.
PKG has a better Debt to Equity ratio (0.54) than 86.96% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.54
Debt/FCF 3.03
Altman-Z 4.27
ROIC/WACC1.59
WACC7.89%

2.3 Liquidity

PKG has a Current Ratio of 2.17. This indicates that PKG is financially healthy and has no problem in meeting its short term obligations.
With an excellent Current ratio value of 2.17, PKG belongs to the best of the industry, outperforming 86.96% of the companies in the same industry.
A Quick Ratio of 1.40 indicates that PKG should not have too much problems paying its short term obligations.
PKG has a better Quick ratio (1.40) than 86.96% of its industry peers.
Industry RankSector Rank
Current Ratio 2.17
Quick Ratio 1.4

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2

3. Growth

3.1 Past

PKG shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -22.79%.
The Earnings Per Share has been growing by 13.04% on average over the past years. This is quite good.
Looking at the last year, PKG shows a decrease in Revenue. The Revenue has decreased by -8.19% in the last year.
Measured over the past years, PKG shows a small growth in Revenue. The Revenue has been growing by 5.64% on average per year.
EPS 1Y (TTM)-22.79%
EPS 3Y13.31%
EPS 5Y13.04%
EPS growth Q2Q-27.56%
Revenue 1Y (TTM)-8.19%
Revenue growth 3Y6.78%
Revenue growth 5Y5.64%
Revenue growth Q2Q-8.93%

3.2 Future

PKG is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -1.34% yearly.
PKG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 0.54% yearly.
EPS Next Y-24.08%
EPS Next 2Y-13.83%
EPS Next 3Y-5.28%
EPS Next 5Y-1.34%
Revenue Next Year-9.17%
Revenue Next 2Y-4.08%
Revenue Next 3Y-1.9%
Revenue Next 5Y0.54%

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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2

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 18.39, PKG is valued on the expensive side.
PKG's Price/Earnings ratio is a bit more expensive when compared to the industry. PKG is more expensive than 65.22% of the companies in the same industry.
PKG's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.97.
PKG is valuated rather expensively with a Price/Forward Earnings ratio of 19.83.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PKG indicates a slightly more expensive valuation: PKG is more expensive than 73.91% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.05, PKG is valued at the same level.
Industry RankSector Rank
PE 18.39
Fwd PE 19.83

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, PKG is valued a bit more expensive than 65.22% of the companies in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as PKG.
Industry RankSector Rank
P/FCF 17.88
EV/EBITDA 9.93

4.3 Compensation for Growth

The excellent profitability rating of PKG may justify a higher PE ratio.
PKG's earnings are expected to decrease with -5.28% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)1.41
EPS Next 2Y-13.83%
EPS Next 3Y-5.28%

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6

5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 3.04%, PKG has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.96, PKG pays a bit more dividend than its industry peers.
PKG's Dividend Yield is comparable with the S&P500 average which is at 2.56.
Industry RankSector Rank
Dividend Yield 3.04%

5.2 History

On average, the dividend of PKG grows each year by 12.72%, which is quite nice.
PKG has paid a dividend for at least 10 years, which is a reliable track record.
PKG has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)12.72%
Div Incr Years12
Div Non Decr Years13

5.3 Sustainability

57.96% of the earnings are spent on dividend by PKG. This is a bit on the high side, but may be sustainable.
The Dividend Rate of PKG has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.
DP57.96%
EPS Next 2Y-13.83%
EPS Next 3Y-5.28%

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PACKAGING CORP OF AMERICA

NYSE:PKG (12/8/2023, 7:10:28 PM)

After market: 163.88 0 (0%)

163.88

-0.44 (-0.27%)

Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryContainers & Packaging
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap14.69B
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield 3.04%
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
Industry RankSector Rank
PE 18.39
Fwd PE 19.83
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)1.41
Profitability
Industry RankSector Rank
ROA 9.55%
ROE 20.1%
ROCE
ROIC
ROICexc
ROICexgc
OM 14.6%
PM (TTM) 9.96%
GM 22.17%
FCFM
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.96
Health
Industry RankSector Rank
Debt/Equity 0.54
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 2.17
Quick Ratio 1.4
Altman-Z
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-22.79%
EPS 3Y13.31%
EPS 5Y
EPS growth Q2Q
EPS Next Y-24.08%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-8.19%
Revenue growth 3Y6.78%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y