Packaging Corporation of America ( PKG Quick Quote PKG - Free Report) is set to release fourth-quarter 2021 results after the closing bell on Jan 26. Q3 Results
In the last reported quarter, Packaging Corp’s earnings and revenues beat the respective Zacks Consensus Estimate. The top and the bottom line increased year over year. The company has a trailing four-quarter earnings surprise of 13.01%, on average.
The Zacks Consensus Estimate for Packaging Corp’s fourth-quarter earnings per share is currently pegged at $2.08, suggesting growth of 56.4% from the prior-year quarter’s levels. The Zacks Consensus Estimate for total sales is pinned at $1.92 billion, indicating a rise of 11.8% from the year-ago quarter’s levels.
Factors at Play
Packaging products are essential for the distribution of food, beverage and pharmaceutical products. Hence, the elevated demand for meat, fruit and vegetables, processed food, beverages, medicine and other consumer products in response to the coronavirus pandemic is expected to have aided the Packaging segment’s October-December quarter performance. Strong demand for containerboard and corrugated products is likely to have driven the segment. The Zacks Consensus Estimate for the segment’s quarterly revenues is pegged at $1,788 million, calling for a year-over-year jump of 16%. The consensus mark for the company’s operating income is pinned at $302 million, indicating year-over-year growth of 42%. The segment’s volume will be lower due to three fewer shipping days and the scheduled outage at the DeRidder Mill.
The e-commerce boom has been driving the company’s box demand. Packaging Corp’s containerboard mills set an all-time quarterly sales volume record and its box plants set new records for the total corrugated product shipments in third-quarter 2021. The company is likely to have gained from this momentum in the fourth quarter as well. The pandemic has affected paper consumption in schools, offices and businesses, straining paper demand. Also, the paper segment has been impacted unfavorably by the dismal paper demand due to the rising preference for electronic data transmission, e-readers and electronic document storage alternatives. These are likely to get reflected in the company’s results for the quarter to be reported. The Zacks Consensus Estimate for Paper segment’s revenues is pegged at $144 million for the December-end quarter, suggesting a year-over-year decline of 7.7%. The Zacks Consensus Estimate for the segment’s operating income is pinned at $9.40 million, calling for an increase from the prior-year quarter’s $2.5 million. Elevated material costs, higher energy and wood costs, coupled with rising scheduled outage costs might have dented the company’s margins during the fourth quarter. What Our Model Indicates
Our proven model doesn’t conclusively predict an earnings beat for Packaging Corp this season. The combination of a positive
Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. Earnings ESP: The Earnings ESP for Packaging Corp is -0.72%. Zacks Rank: Packaging Corp currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here. Price Performance
In a year’s time, shares of Packaging Corp have declined 0.9% against the
industry’s growth of 14.9%. Image Source: Zacks Investment Research Stocks Poised to Beat Earnings Estimates
Here are some Industrial Products stocks, which you may consider as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases:
W.W. Grainger, Inc. ( GWW Quick Quote GWW - Free Report) currently has an Earnings ESP of +2.29% and a Zacks Rank of 2. The Zacks Consensus Estimate for fourth-quarter 2021 earnings has moved up 0.2% in the past 30 days to $5.25 per share, suggesting year-over-year growth of 43.4%. The Zacks Consensus Estimate for quarterly revenues is pegged at $3.2 billion, which indicates an improvement of 11.3% from the prior-year quarter’s levels. Grainger has a long-term earnings growth rate of 13%. AGCO Corporation ( AGCO Quick Quote AGCO - Free Report) currently has an Earnings ESP of +25% and a Zacks Rank of 2. The Zacks Consensus Estimate for fourth-quarter 2021 earnings is currently pegged at $1.72 per share, suggesting 11.7% growth from the year-ago quarter’s tally. The Zacks Consensus Estimate for quarterly revenues is pinned at $3.04 billion, highlighting year-over-year growth of 11.9%. AGCO corporation has a trailing four-quarter earnings surprise of 47.5%, on average. It has a long-term earnings growth of 19.1%. Terex Corporation ( TEX Quick Quote TEX - Free Report) currently has an Earnings ESP of +1.36% and a Zacks Rank #3. The Zacks Consensus Estimate for fourth-quarter 2021 earnings have been stable in the past 30 days and is currently pegged at 55 cents per share. This indicates 162% growth from the prior-year quarter’s tally. The Zacks Consensus Estimate for quarterly revenues is pegged at $948.5 million, which indicates an year-over-year improvement of 20.5%. Terex has a trailing four-quarter earnings surprise of 80.4%, on average. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.