PACKAGING CORP OF AMERICA (PKG)

US6951561090 - Common Stock

240.59  +1.11 (+0.46%)

After market: 240.59 0 (0%)

Fundamental Rating

6

We assign a fundamental rating of 6 out of 10 to PKG. PKG was compared to 24 industry peers in the Containers & Packaging industry. PKG gets an excellent profitability rating and is at the same time showing great financial health properties. PKG is valied quite expensively at the moment, while it does show a decent growth rate.



7

1. Profitability

1.1 Basic Checks

PKG had positive earnings in the past year.
In the past year PKG had a positive cash flow from operations.
Each year in the past 5 years PKG has been profitable.
In the past 5 years PKG always reported a positive cash flow from operatings.

1.2 Ratios

With an excellent Return On Assets value of 7.94%, PKG belongs to the best of the industry, outperforming 86.96% of the companies in the same industry.
With a decent Return On Equity value of 17.28%, PKG is doing good in the industry, outperforming 73.91% of the companies in the same industry.
PKG's Return On Invested Capital of 10.34% is amongst the best of the industry. PKG outperforms 91.30% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PKG is significantly below the industry average of 382233.01%.
Industry RankSector Rank
ROA 7.94%
ROE 17.28%
ROIC 10.34%
ROA(3y)10.72%
ROA(5y)9.57%
ROE(3y)23.33%
ROE(5y)21.32%
ROIC(3y)13.62%
ROIC(5y)12.59%

1.3 Margins

PKG has a Profit Margin of 8.99%. This is amongst the best in the industry. PKG outperforms 91.30% of its industry peers.
PKG's Profit Margin has been stable in the last couple of years.
With an excellent Operating Margin value of 13.05%, PKG belongs to the best of the industry, outperforming 86.96% of the companies in the same industry.
In the last couple of years the Operating Margin of PKG has declined.
The Gross Margin of PKG (20.57%) is comparable to the rest of the industry.
PKG's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 13.05%
PM (TTM) 8.99%
GM 20.57%
OM growth 3Y4.22%
OM growth 5Y-1.85%
PM growth 3Y12.29%
PM growth 5Y-1.4%
GM growth 3Y1.5%
GM growth 5Y-1.48%

8

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so PKG is still creating some value.
PKG has about the same amout of shares outstanding than it did 1 year ago.
PKG has less shares outstanding than it did 5 years ago.
The debt/assets ratio for PKG is higher compared to a year ago.

2.2 Solvency

An Altman-Z score of 4.76 indicates that PKG is not in any danger for bankruptcy at the moment.
PKG has a Altman-Z score of 4.76. This is amongst the best in the industry. PKG outperforms 91.30% of its industry peers.
PKG has a debt to FCF ratio of 4.38. This is a neutral value as PKG would need 4.38 years to pay back of all of its debts.
The Debt to FCF ratio of PKG (4.38) is better than 91.30% of its industry peers.
A Debt/Equity ratio of 0.60 indicates that PKG is somewhat dependend on debt financing.
PKG has a Debt to Equity ratio of 0.60. This is amongst the best in the industry. PKG outperforms 86.96% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.6
Debt/FCF 4.38
Altman-Z 4.76
ROIC/WACC1.26
WACC8.22%

2.3 Liquidity

PKG has a Current Ratio of 2.43. This indicates that PKG is financially healthy and has no problem in meeting its short term obligations.
With an excellent Current ratio value of 2.43, PKG belongs to the best of the industry, outperforming 95.65% of the companies in the same industry.
PKG has a Quick Ratio of 1.71. This is a normal value and indicates that PKG is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.71, PKG belongs to the top of the industry, outperforming 82.61% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 2.43
Quick Ratio 1.71

4

3. Growth

3.1 Past

The earnings per share for PKG have decreased by -2.36% in the last year.
The Earnings Per Share has been growing slightly by 1.59% on average over the past years.
The Revenue has been growing slightly by 4.24% in the past year.
PKG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.15% yearly.
EPS 1Y (TTM)-2.36%
EPS 3Y14.56%
EPS 5Y1.59%
EPS Q2Q%29.27%
Revenue 1Y (TTM)4.24%
Revenue growth 3Y5.43%
Revenue growth 5Y2.15%
Sales Q2Q%12.73%

3.2 Future

The Earnings Per Share is expected to grow by 7.35% on average over the next years.
PKG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.64% yearly.
EPS Next Y5.72%
EPS Next 2Y14.31%
EPS Next 3Y12.76%
EPS Next 5Y7.35%
Revenue Next Year7.73%
Revenue Next 2Y7.11%
Revenue Next 3Y5.87%
Revenue Next 5Y3.64%

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

1

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 27.65, which means the current valuation is very expensive for PKG.
Based on the Price/Earnings ratio, PKG is valued a bit more expensive than the industry average as 73.91% of the companies are valued more cheaply.
When comparing the Price/Earnings ratio of PKG to the average of the S&P500 Index (29.17), we can say PKG is valued inline with the index average.
The Price/Forward Earnings ratio is 21.19, which indicates a rather expensive current valuation of PKG.
78.26% of the companies in the same industry are cheaper than PKG, based on the Price/Forward Earnings ratio.
PKG is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 23.71, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 27.65
Fwd PE 21.19

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, PKG is valued more expensive than 82.61% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PKG indicates a slightly more expensive valuation: PKG is more expensive than 65.22% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 32.8
EV/EBITDA 14.75

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates PKG does not grow enough to justify the current Price/Earnings ratio.
PKG has a very decent profitability rating, which may justify a higher PE ratio.
PKG's earnings are expected to grow with 12.76% in the coming years. This may justify a more expensive valuation.
PEG (NY)4.84
PEG (5Y)17.37
EPS Next 2Y14.31%
EPS Next 3Y12.76%

5

5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 2.09%, PKG has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.86, PKG has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.21, PKG has a dividend comparable with the average S&P500 company.
Industry RankSector Rank
Dividend Yield 2.09%

5.2 History

The dividend of PKG is nicely growing with an annual growth rate of 12.01%!
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)12.01%
Div Incr Years13
Div Non Decr Years14

5.3 Sustainability

62.92% of the earnings are spent on dividend by PKG. This is not a sustainable payout ratio.
PKG's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP62.92%
EPS Next 2Y14.31%
EPS Next 3Y12.76%

PACKAGING CORP OF AMERICA

NYSE:PKG (11/8/2024, 8:14:12 PM)

After market: 240.59 0 (0%)

240.59

+1.11 (+0.46%)

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 Cap21.61B
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield 2.09%
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)
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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)
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Min Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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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 27.65
Fwd PE 21.19
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)4.84
PEG (5Y)17.37
Profitability
Industry RankSector Rank
ROA 7.94%
ROE 17.28%
ROCE
ROIC
ROICexc
ROICexgc
OM 13.05%
PM (TTM) 8.99%
GM 20.57%
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 Turnover0.88
Health
Industry RankSector Rank
Debt/Equity 0.6
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 2.43
Quick Ratio 1.71
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)
High Growth Momentum
Growth
EPS 1Y (TTM)-2.36%
EPS 3Y14.56%
EPS 5Y
EPS Q2Q%
EPS Next Y5.72%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)4.24%
Revenue growth 3Y5.43%
Revenue growth 5Y
Sales 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