PACKAGING CORP OF AMERICA (PKG) Stock Fundamental Analysis
NYSE:PKG - New York Stock Exchange, Inc. - US6951561090 - Common Stock - Currency: USD
PKG gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 24 industry peers in the Containers & Packaging industry. PKG has an excellent financial health rating, but there are some minor concerns on its profitability. PKG is quite expensive at the moment. It does show a decent growth rate.
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.
In the past 5 years PKG has always been profitable.
Of the past 5 years PKG 4 years had a positive operating cash flow.
1.2 Ratios
The Return On Assets of PKG (8.77%) is better than 95.65% of its industry peers.
PKG's Return On Equity of 18.00% is fine compared to the rest of the industry. PKG outperforms 73.91% of its industry peers.
PKG has a Return On Invested Capital of 10.92%. This is amongst the best in the industry. PKG outperforms 91.30% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.77% | ||
| ROE | 18% | ||
| ROIC | 10.92% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
PKG has a Profit Margin of 9.39%. This is amongst the best in the industry. PKG outperforms 91.30% of its industry peers.
In the last couple of years the Profit Margin of PKG has remained more or less at the same level.
PKG has a better Operating Margin (13.53%) than 91.30% of its industry peers.
PKG's Operating Margin has declined in the last couple of years.
With a Gross Margin value of 21.08%, PKG perfoms like the industry average, outperforming 52.17% of the companies in the same industry.
PKG's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.53% | ||
| PM (TTM) | 9.39% | ||
| GM | 21.08% |
OM growth 3Y-7.5%
OM growth 5Y-3.26%
PM growth 3Y-4.05%
PM growth 5Y-0.79%
GM growth 3Y-4.25%
GM growth 5Y-2.06%
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 no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
An Altman-Z score of 4.79 indicates that PKG is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 4.79, PKG belongs to the best of the industry, outperforming 95.65% of the companies in the same industry.
The Debt to FCF ratio of PKG is 4.21, which is a neutral value as it means it would take PKG, 4.21 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 4.21, PKG belongs to the top of the industry, outperforming 95.65% of the companies in the same industry.
A Debt/Equity ratio of 0.58 indicates that PKG is somewhat dependend on debt financing.
PKG has a Debt to Equity ratio of 0.58. This is amongst the best in the industry. PKG outperforms 91.30% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.58 | ||
| Debt/FCF | 4.21 | ||
| Altman-Z | 4.79 |
ROIC/WACC1.34
WACC8.12%
2.3 Liquidity
A Current Ratio of 2.95 indicates that PKG has no problem at all paying its short term obligations.
With an excellent Current ratio value of 2.95, PKG belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
PKG has a Quick Ratio of 1.98. This is a normal value and indicates that PKG is financially healthy and should not expect problems in meeting its short term obligations.
PKG's Quick ratio of 1.98 is amongst the best of the industry. PKG outperforms 91.30% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.95 | ||
| Quick Ratio | 1.98 |
3. Growth
3.1 Past
PKG shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.03%.
Measured over the past 5 years, PKG shows a small growth in Earnings Per Share. The EPS has been growing by 3.40% on average per year.
Looking at the last year, PKG shows a small growth in Revenue. The Revenue has grown by 7.45% in the last year.
Measured over the past years, PKG shows a small growth in Revenue. The Revenue has been growing by 3.78% on average per year.
EPS 1Y (TTM)4.03%
EPS 3Y-1.26%
EPS 5Y3.4%
EPS Q2Q%15.96%
Revenue 1Y (TTM)7.45%
Revenue growth 3Y2.74%
Revenue growth 5Y3.78%
Sales Q2Q%10.74%
3.2 Future
The Earnings Per Share is expected to grow by 6.39% on average over the next years.
Based on estimates for the next years, PKG will show a small growth in Revenue. The Revenue will grow by 3.62% on average per year.
EPS Next Y19.66%
EPS Next 2Y14.97%
EPS Next 3Y12.44%
EPS Next 5Y6.39%
Revenue Next Year6.84%
Revenue Next 2Y5.09%
Revenue Next 3Y4.57%
Revenue Next 5Y3.62%
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 stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 23.57, the valuation of PKG can be described as rather expensive.
69.57% of the companies in the same industry are cheaper than PKG, based on the Price/Earnings ratio.
PKG's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 29.98.
Based on the Price/Forward Earnings ratio of 19.70, the valuation of PKG can be described as rather expensive.
Based on the Price/Forward Earnings ratio, PKG is valued a bit more expensive than the industry average as 73.91% of the companies are valued more cheaply.
PKG is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 22.66, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.57 | ||
| Fwd PE | 19.7 |
4.2 Price Multiples
PKG's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. PKG is more expensive than 73.91% of the companies in the same industry.
60.87% of the companies in the same industry are cheaper than PKG, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.46 | ||
| EV/EBITDA | 12.76 |
4.3 Compensation for Growth
PKG's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PKG has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as PKG's earnings are expected to grow with 12.44% in the coming years.
PEG (NY)1.2
PEG (5Y)6.94
EPS Next 2Y14.97%
EPS Next 3Y12.44%
5. Dividend
5.1 Amount
PKG has a Yearly Dividend Yield of 2.37%.
PKG's Dividend Yield is a higher than the industry average which is at 3.14.
PKG's Dividend Yield is comparable with the S&P500 average which is at 2.30.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.37% |
5.2 History
The dividend of PKG is nicely growing with an annual growth rate of 12.01%!
PKG has been paying a dividend for at least 10 years, so it has 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
PKG pays out 58.43% of its income as dividend. This is a bit on the high side, but may be sustainable.
PKG's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP58.43%
EPS Next 2Y14.97%
EPS Next 3Y12.44%
213.09
+2.34 (+1.11%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryContainers & Packaging
Earnings (Last)
Earnings (Next)
Inst Owners92.46%
Inst Owner Change1.9%
Ins Owners1.53%
Ins Owner Change-5.71%
Market Cap19.14B
Analysts75.71
Price Target245 (14.97%)
Short Float %1.59%
Short Ratio1.59
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.37% |
Yearly Dividend5.01
Dividend Growth(5Y)12.01%
DP58.43%
Div Incr Years13
Div Non Decr Years14
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.41%
Min EPS beat(2)1.91%
Max EPS beat(2)4.9%
EPS beat(4)4
Avg EPS beat(4)5.81%
Min EPS beat(4)1.5%
Max EPS beat(4)14.94%
EPS beat(8)7
Avg EPS beat(8)5.99%
EPS beat(12)10
Avg EPS beat(12)8.23%
EPS beat(16)13
Avg EPS beat(16)9.13%
Revenue beat(2)2
Avg Revenue beat(2)2.33%
Min Revenue beat(2)1.48%
Max Revenue beat(2)3.19%
Revenue beat(4)4
Avg Revenue beat(4)1.99%
Min Revenue beat(4)0.62%
Max Revenue beat(4)3.19%
Revenue beat(8)4
Avg Revenue beat(8)-1.08%
Revenue beat(12)7
Avg Revenue beat(12)-0.1%
Revenue beat(16)10
Avg Revenue beat(16)0.53%
PT rev (1m)-3.95%
PT rev (3m)3.49%
EPS NQ rev (1m)0.94%
EPS NQ rev (3m)0.94%
EPS NY rev (1m)-6.34%
EPS NY rev (3m)-4.74%
Revenue NQ rev (1m)0.14%
Revenue NQ rev (3m)0.14%
Revenue NY rev (1m)-0.15%
Revenue NY rev (3m)0.42%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.57 | ||
| Fwd PE | 19.7 | ||
| P/S | 2.34 | ||
| P/FCF | 32.46 | ||
| P/OCF | 15.93 | ||
| P/B | 4.49 | ||
| P/tB | 6.09 | ||
| EV/EBITDA | 12.76 |
EPS(TTM)9.04
EY4.24%
EPS(NY)10.82
Fwd EY5.08%
FCF(TTM)6.57
FCFY3.08%
OCF(TTM)13.38
OCFY6.28%
SpS91.04
BVpS47.48
TBVpS34.97
PEG (NY)1.2
PEG (5Y)6.94
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.77% | ||
| ROE | 18% | ||
| ROCE | 14.45% | ||
| ROIC | 10.92% | ||
| ROICexc | 12.14% | ||
| ROICexgc | 14.51% | ||
| OM | 13.53% | ||
| PM (TTM) | 9.39% | ||
| GM | 21.08% | ||
| FCFM | 7.21% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y-7.5%
OM growth 5Y-3.26%
PM growth 3Y-4.05%
PM growth 5Y-0.79%
GM growth 3Y-4.25%
GM growth 5Y-2.06%
F-Score6
Asset Turnover0.93
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.58 | ||
| Debt/FCF | 4.21 | ||
| Debt/EBITDA | 1.53 | ||
| Cap/Depr | 117.48% | ||
| Cap/Sales | 7.48% | ||
| Interest Coverage | 11.49 | ||
| Cash Conversion | 73.84% | ||
| Profit Quality | 76.81% | ||
| Current Ratio | 2.95 | ||
| Quick Ratio | 1.98 | ||
| Altman-Z | 4.79 |
F-Score6
WACC8.12%
ROIC/WACC1.34
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)4.03%
EPS 3Y-1.26%
EPS 5Y3.4%
EPS Q2Q%15.96%
EPS Next Y19.66%
EPS Next 2Y14.97%
EPS Next 3Y12.44%
EPS Next 5Y6.39%
Revenue 1Y (TTM)7.45%
Revenue growth 3Y2.74%
Revenue growth 5Y3.78%
Sales Q2Q%10.74%
Revenue Next Year6.84%
Revenue Next 2Y5.09%
Revenue Next 3Y4.57%
Revenue Next 5Y3.62%
EBIT growth 1Y-3.43%
EBIT growth 3Y-4.97%
EBIT growth 5Y0.4%
EBIT Next Year67.33%
EBIT Next 3Y23.59%
EBIT Next 5Y13.98%
FCF growth 1Y-28.21%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-14.2%
OCF growth 3YN/A
OCF growth 5YN/A