PACKAGING CORP OF AMERICA (PKG) Stock Fundamental Analysis
NYSE:PKG - New York Stock Exchange, Inc. - US6951561090 - Common Stock - Currency: USD
Overall PKG gets a fundamental rating of 6 out of 10. We evaluated PKG against 22 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 quite expensive at the moment. It does show a decent growth rate. With these ratings, PKG could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
PKG had positive earnings in the past year.
PKG had a positive operating cash flow in the past year.
PKG had positive earnings in each of the past 5 years.
In the past 5 years PKG always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of PKG (9.54%) is better than 100.00% of its industry peers.
PKG's Return On Equity of 19.02% is fine compared to the rest of the industry. PKG outperforms 77.27% of its industry peers.
The Return On Invested Capital of PKG (11.66%) is better than 90.91% of its industry peers.
PKG had an Average Return On Invested Capital over the past 3 years of 12.69%. This is significantly above the industry average of 7.58%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.54% | ||
| ROE | 19.02% | ||
| ROIC | 11.66% |
ROA(3y)10.19%
ROA(5y)9.47%
ROE(3y)21.67%
ROE(5y)20.45%
ROIC(3y)12.69%
ROIC(5y)12.31%
1.3 Margins
PKG's Profit Margin of 10.02% is amongst the best of the industry. PKG outperforms 95.45% of its industry peers.
In the last couple of years the Profit Margin of PKG has remained more or less at the same level.
The Operating Margin of PKG (14.38%) is better than 95.45% of its industry peers.
PKG's Operating Margin has declined in the last couple of years.
PKG has a Gross Margin of 21.85%. This is in the better half of the industry: PKG outperforms 63.64% of its industry peers.
In the last couple of years the Gross Margin of PKG has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.38% | ||
| PM (TTM) | 10.02% | ||
| GM | 21.85% |
OM growth 3Y-6.17%
OM growth 5Y-2.42%
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
PKG has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, PKG has more shares outstanding
The number of shares outstanding for PKG has been reduced compared to 5 years ago.
PKG has a better debt/assets ratio than last year.
2.2 Solvency
PKG has an Altman-Z score of 4.82. This indicates that PKG is financially healthy and has little risk of bankruptcy at the moment.
PKG has a better Altman-Z score (4.82) than 95.45% of its industry peers.
The Debt to FCF ratio of PKG is 4.71, which is a neutral value as it means it would take PKG, 4.71 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 4.71, PKG belongs to the top of the industry, outperforming 95.45% of the companies in the same industry.
A Debt/Equity ratio of 0.55 indicates that PKG is somewhat dependend on debt financing.
PKG's Debt to Equity ratio of 0.55 is amongst the best of the industry. PKG outperforms 86.36% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.55 | ||
| Debt/FCF | 4.71 | ||
| Altman-Z | 4.82 |
ROIC/WACC1.4
WACC8.31%
2.3 Liquidity
A Current Ratio of 3.28 indicates that PKG has no problem at all paying its short term obligations.
The Current ratio of PKG (3.28) is better than 100.00% of its industry peers.
PKG has a Quick Ratio of 2.15. This indicates that PKG is financially healthy and has no problem in meeting its short term obligations.
Looking at the Quick ratio, with a value of 2.15, PKG belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.28 | ||
| Quick Ratio | 2.15 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 17.30% over the past year.
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.
PKG shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.47%.
PKG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.78% yearly.
EPS 1Y (TTM)17.3%
EPS 3Y-1.26%
EPS 5Y3.4%
EPS Q2Q%34.3%
Revenue 1Y (TTM)9.47%
Revenue growth 3Y2.74%
Revenue growth 5Y3.78%
Sales Q2Q%8.16%
3.2 Future
The Earnings Per Share is expected to grow by 8.92% on average over the next years. This is quite good.
The Revenue is expected to grow by 4.23% on average over the next years.
EPS Next Y14.38%
EPS Next 2Y11.72%
EPS Next 3Y9.35%
EPS Next 5Y8.92%
Revenue Next Year5.73%
Revenue Next 2Y4.53%
Revenue Next 3Y4.23%
Revenue Next 5Y4.23%
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
The Price/Earnings ratio is 21.38, which indicates a rather expensive current valuation of PKG.
63.64% 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 27.30.
A Price/Forward Earnings ratio of 18.25 indicates a rather expensive valuation of PKG.
Based on the Price/Forward Earnings ratio, PKG is valued a bit more expensive than the industry average as 68.18% of the companies are valued more cheaply.
When comparing the Price/Forward Earnings ratio of PKG to the average of the S&P500 Index (21.76), we can say PKG is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.38 | ||
| Fwd PE | 18.25 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as PKG.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PKG is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.18 | ||
| EV/EBITDA | 11.45 |
4.3 Compensation for Growth
PKG's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of PKG may justify a higher PE ratio.
PEG (NY)1.49
PEG (5Y)6.3
EPS Next 2Y11.72%
EPS Next 3Y9.35%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.41%, PKG has a reasonable but not impressive dividend return.
PKG's Dividend Yield is a higher than the industry average which is at 2.90.
PKG's Dividend Yield is comparable with the S&P500 average which is at 2.37.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.41% |
5.2 History
On average, the dividend of PKG grows each year by 9.64%, which is quite nice.
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)9.64%
Div Incr Years0
Div Non Decr Years15
5.3 Sustainability
PKG pays out 52.47% 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.
DP52.47%
EPS Next 2Y11.72%
EPS Next 3Y9.35%
205.9
-1.34 (-0.65%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryContainers & Packaging
Earnings (Last)
Earnings (Next)
Inst Owners92.17%
Inst Owner Change0.01%
Ins Owners1.61%
Ins Owner Change6.81%
Market Cap18.53B
Analysts72
Price Target207.23 (0.65%)
Short Float %2.23%
Short Ratio2.49
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.41% |
Yearly Dividend5
Dividend Growth(5Y)9.64%
DP52.47%
Div Incr Years0
Div Non Decr Years15
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.08%
Min EPS beat(2)-3.46%
Max EPS beat(2)3.62%
EPS beat(4)3
Avg EPS beat(4)1.74%
Min EPS beat(4)-3.46%
Max EPS beat(4)4.9%
EPS beat(8)7
Avg EPS beat(8)5.93%
EPS beat(12)9
Avg EPS beat(12)4.98%
EPS beat(16)13
Avg EPS beat(16)8.34%
Revenue beat(2)1
Avg Revenue beat(2)0.17%
Min Revenue beat(2)-0.23%
Max Revenue beat(2)0.56%
Revenue beat(4)3
Avg Revenue beat(4)1.25%
Min Revenue beat(4)-0.23%
Max Revenue beat(4)3.19%
Revenue beat(8)5
Avg Revenue beat(8)0.22%
Revenue beat(12)6
Avg Revenue beat(12)-0.74%
Revenue beat(16)10
Avg Revenue beat(16)0.39%
PT rev (1m)-3.9%
PT rev (3m)-15.42%
EPS NQ rev (1m)0.12%
EPS NQ rev (3m)-10.74%
EPS NY rev (1m)-0.18%
EPS NY rev (3m)-5.52%
Revenue NQ rev (1m)0.14%
Revenue NQ rev (3m)-2.56%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-1.23%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.38 | ||
| Fwd PE | 18.25 | ||
| P/S | 2.17 | ||
| P/FCF | 35.18 | ||
| P/OCF | 14.59 | ||
| P/B | 4.12 | ||
| P/tB | 5.46 | ||
| EV/EBITDA | 11.45 |
EPS(TTM)9.63
EY4.68%
EPS(NY)11.28
Fwd EY5.48%
FCF(TTM)5.85
FCFY2.84%
OCF(TTM)14.11
OCFY6.85%
SpS94.96
BVpS50
TBVpS37.72
PEG (NY)1.49
PEG (5Y)6.3
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.54% | ||
| ROE | 19.02% | ||
| ROCE | 15.43% | ||
| ROIC | 11.66% | ||
| ROICexc | 13.04% | ||
| ROICexgc | 15.44% | ||
| OM | 14.38% | ||
| PM (TTM) | 10.02% | ||
| GM | 21.85% | ||
| FCFM | 6.16% |
ROA(3y)10.19%
ROA(5y)9.47%
ROE(3y)21.67%
ROE(5y)20.45%
ROIC(3y)12.69%
ROIC(5y)12.31%
ROICexc(3y)14.1%
ROICexc(5y)13.85%
ROICexgc(3y)17.07%
ROICexgc(5y)16.99%
ROCE(3y)16.8%
ROCE(5y)16.3%
ROICexcg growth 3Y-8.84%
ROICexcg growth 5Y-4.23%
ROICexc growth 3Y-7.38%
ROICexc growth 5Y-2.79%
OM growth 3Y-6.17%
OM growth 5Y-2.42%
PM growth 3Y-4.05%
PM growth 5Y-0.79%
GM growth 3Y-4.25%
GM growth 5Y-2.06%
F-Score8
Asset Turnover0.95
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.55 | ||
| Debt/FCF | 4.71 | ||
| Debt/EBITDA | 1.41 | ||
| Cap/Depr | 138.86% | ||
| Cap/Sales | 8.7% | ||
| Interest Coverage | 12.2 | ||
| Cash Conversion | 71.99% | ||
| Profit Quality | 61.54% | ||
| Current Ratio | 3.28 | ||
| Quick Ratio | 2.15 | ||
| Altman-Z | 4.82 |
F-Score8
WACC8.31%
ROIC/WACC1.4
Cap/Depr(3y)133.6%
Cap/Depr(5y)130.1%
Cap/Sales(3y)7.95%
Cap/Sales(5y)7.63%
Profit Quality(3y)80.36%
Profit Quality(5y)86.35%
High Growth Momentum
Growth
EPS 1Y (TTM)17.3%
EPS 3Y-1.26%
EPS 5Y3.4%
EPS Q2Q%34.3%
EPS Next Y14.38%
EPS Next 2Y11.72%
EPS Next 3Y9.35%
EPS Next 5Y8.92%
Revenue 1Y (TTM)9.47%
Revenue growth 3Y2.74%
Revenue growth 5Y3.78%
Sales Q2Q%8.16%
Revenue Next Year5.73%
Revenue Next 2Y4.53%
Revenue Next 3Y4.23%
Revenue Next 5Y4.23%
EBIT growth 1Y17.42%
EBIT growth 3Y-3.6%
EBIT growth 5Y1.26%
EBIT Next Year62.8%
EBIT Next 3Y21.34%
EBIT Next 5Y15.38%
FCF growth 1Y-26.98%
FCF growth 3Y2.17%
FCF growth 5Y-8.36%
OCF growth 1Y-12.43%
OCF growth 3Y2.87%
OCF growth 5Y-0.27%