Investment Thesis
PKG demonstrates solid operational profitability with healthy margins (21% gross, 12.3% operating) and strong cash generation ($728.6M FCF), supported by excellent liquidity (3.17x current ratio). However, the extraordinary 11,464.5% revenue increase raises data quality concerns, and the combination of high leverage (0.87x debt/equity) with $4.0B long-term debt against modest equity ($4.6B) creates financial risk that warrants cautious positioning.
PKG Strengths
- Strong free cash flow generation ($728.6M) providing financial flexibility
- Healthy gross margins (21%) and operating margins (12.3%) indicating pricing power in containerboard market
- Excellent liquidity position (3.17x current ratio, 1.94x quick ratio) reduces financial distress risk
- Positive ROE (16.8%) and ROA (7.2%) demonstrate capital deployment efficiency
PKG Risks
- Highly suspicious revenue growth figure (11,464.5% YoY) suggests significant data quality issues or extraordinary one-time events requiring investigation
- Elevated leverage with $4.0B long-term debt relative to $4.6B equity creates vulnerability to commodity price cycles endemic to packaging industry
- Diluted EPS declined 3.9% YoY despite revenue surge, indicating earnings quality concerns or operational headwinds
- Missing interest coverage ratio and incomplete liability data limit ability to assess debt servicing capacity
Key Metrics to Watch
- Underlying organic revenue growth and margin sustainability post-anomaly resolution
- Debt service coverage ratio and free cash flow trend given high absolute debt levels
- Operating leverage and cost structure response to containerboard commodity price cycles
PKG Financial Metrics
PKG Profitability Ratios
PKG Balance Sheet & Liquidity
PKG 5-Year Financial Trend
5-Year Trend Summary: PACKAGING CORP OF AMERICA's revenue has grown significantly by 16% over the 5-year period, indicating strong business expansion. The most recent EPS of $8.48 reflects profitable operations.
PKG Growth Metrics (YoY)
PKG Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $2.2B | $226.9M | $2.51 |
| Q2 2025 | $2.1B | $198.9M | $2.21 |
| Q1 2025 | $2.0B | $146.9M | $1.63 |
| Q3 2024 | $1.9B | $183.2M | $2.03 |
| Q2 2024 | $2.0B | $198.9M | $2.21 |
| Q1 2024 | $2.0B | $146.9M | $1.63 |
| Q3 2023 | $1.9B | $183.2M | $2.03 |
| Q2 2023 | $2.0B | $202.7M | $2.24 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
PKG Capital Allocation
PKG SEC Filings
Access official SEC EDGAR filings for PACKAGING CORP OF AMERICA (CIK: 0000075677)