Is Packaging Corporation of America below Nasdaq’s performance?

It is based in Lake Forest, Illinois, and is worth $16.8 billion in market capitalization at Packaging Corporation of America (PKG), and operates as a leading US producer of container board and cardboard packaging. PKG operates through the packaging and paper segments and provides essential products such as shipping containers and protective packaging to industries such as food, beverages and industrial products.

Companies worth more than $10 billion are commonly referred to as “large caps.” PKG fits perfectly into that category, with market capitalization exceeding the threshold, reflecting the substantial scale and influence in a competitive industry for packaging and containers.

The PKG is currently 25.8% below the all-time high of $250.82 recorded on November 25, 2024. PKG shares have fallen 5.8% over the past three months, particularly below the 11.7% rise in Nasdaq Composite ($nasx) within the simultaneous frame.

In the long term, PKG strains have fallen 17.3% on a YTD basis, below the 1.2% increase in NASDAQ. Furthermore, PKG’s shares have risen slightly over the past 52 weeks, not performing a generous 9.4% return over the same period.

To confirm the recent recession, the PKG has been below the 200-day moving average from early March and below the 50-day moving average from mid-June, which has been fluctuating in recent months.

Despite reporting better than expected financials, PKG’s stock observed a slight DIP in the trading session after the first quarter results were announced on April 22. During the quarter, the company’s packaging sales experienced a solid increase, up 8.2% year-on-year to $210 million, exceeding expectations due to thin margins. On the other hand, driven by a favorable pricing mix, its margins have been observed to be significantly expanded. This has led to the adjusted EPS rising 34.3% year-on-year to $2.31, exceeding the consensus estimate by 4.5%. Following the initial DIP, PKG’s share price rose 2.2% in subsequent trading sessions.

Its rival Ball Corporation (Ball) has declined 10.3% over the past year, decreasing PKG’s performance.

Of the nine analysts covering PKG stocks, the consensus rating is “moderate purchases.” The average price target of $210.22 suggests an upside potential of 12.9% from current price levels.

On the date of publication, Aditya Sarawgi had no position (directly or indirectly) in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. This article was originally published barchart.com