Packaging Corporation of America Poised for Solid Q4 Earnings Release

Analysts Forecast Strong Profit Growth Ahead of Report

Lake Forest, Illinois-based Packaging Corporation of America (PKG) manufactures and sells containerboard and corrugated packaging products. With a market cap of $20.3 billion, the company operates numerous mills, corrugated products plants, and related facilities. It is anticipated that PKG will announce its fiscal Q4 earnings results before the market opens on Tuesday, Jan. 28.

Impressive Earnings Growth Expected

Analysts predict that the packaging giant will report a profit of $2.51 per share, marking a 17.8% increase from $2.13 per share in the same quarter last year. Over the past year, the company has consistently exceeded Wall Street’s bottom-line estimates. In Q3, PKG’s adjusted EPS of $2.65 surpassed expectations by a remarkable 6.8%.

Growth Projections for Fiscal 2024 and Beyond

Looking ahead to fiscal 2024, analysts project PKG’s EPS to reach $9.08, which represents a 4.4% increase from $8.70 in fiscal 2023. Furthermore, EPS is expected to gain 24% year-over-year to $11.26 in fiscal 2025.

Strong Performance Compared to Market Indices

Over the last 52 weeks, PKG shares have climbed 35.4%, outperforming the S&P 500 Index’s ($SPX) 27.2% rise and the Consumer Discretionary Select Sector SPDR Fund’s (XLY) 31.4% gain during the same period.

Positive Market Reaction Following Strong Q3 Earnings

On Oct. 22, shares of PKG jumped 5.5% after the company announced better-than-expected Q3 earnings. The impressive revenue growth of 12.6% year-over-year brought in $2.2 billion. This figure also exceeded the consensus estimates by 4.4%. Adjusted earnings of $2.65 per share represented a 29% increase from the prior year, buoyed by significant growth in gross profit and adjusted operating income, aided by lower freight and logistics costs.

Wall Street Analysts Show Moderate Optimism

Wall Street analysts hold a “Moderate Buy” rating for Packaging Corporation of America. Among eight analysts covering the stock, five recommend a “Strong Buy,” while three suggest a “Hold.” The average analyst price target for PKG is $241.86, suggesting a potential upside of 6.5% from current levels.

On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.