As the Q1 earnings season wraps, let's dig into this quarter's best and worst performers in the industrial packaging industry, including Sealed Air (NYSE:SEE) and its peers.
Industrial packaging companies have built competitive advantages from economies of scale that lead to advantaged purchasing and capital investments that are difficult and expensive to replicate. Recently, eco-friendly packaging and conservation are driving customers preferences and innovation. For example, plastic is not as desirable a material as it once was. Despite being integral to consumer goods ranging from beer to toothpaste to laundry detergent, these companies are still at the whim of the macro, especially consumer health and consumer willingness to spend.
The 9 industrial packaging stocks we track reported a mixed Q1; on average, revenues missed analyst consensus estimates by 1.6%. while next quarter's revenue guidance was 2.1% below consensus. Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. But the beginning of 2024 has seen more volatile stock performance due to mixed inflation data, but industrial packaging stocks have shown resilience, with share prices up 6% on average since the previous earnings results.
Sealed Air (NYSE:SEE) Founded in 1960, Sealed Air Corporation (NYSE: NYSE:SEE) specializes in the development and production of protective and food packaging solutions, serving a variety of industries.
Sealed Air reported revenues of $1.33 billion, down 1.4% year on year, exceeding analysts' expectations by 3.8%. Overall, it was a very strong quarter for the company with an impressive beat of analysts' volume and earnings estimates.
"Our first quarter results were ahead of our expectations, reflecting stronger than expected demand within Food, continued volume stabilization within Protective and accelerated savings from our CTO2Grow program. Our recent commercial reorganization is beginning to take hold with improved execution in the marketplace," said Emile Chammas, SEE's Interim Co-CEO and COO.
Sealed Air achieved the biggest analyst estimates beat of the whole group. The stock is up 16% since reporting and currently trades at $37.21.
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Best Q1: Packaging Corporation of America (NYSE:PKG) Founded in 1959, Packaging Corporation of America (NYSE: PKG) produces containerboard and corrugated packaging products, also offering displays and protective packaging solutions.
Packaging Corporation of America reported revenues of $1.98 billion, flat year on year, outperforming analysts' expectations by 3.7%. It was an exceptional quarter for the company with an impressive beat of analysts' volume estimates and a narrow beat of analysts' earnings estimates .
The market seems happy with the results as the stock is up 6.6% since reporting. It currently trades at $190.98.
Weakest Q1: Silgan Holdings (NYSE:SLGN) Established in 1987, Silgan Holdings (NYSE:SLGN) is a supplier of rigid packaging for consumer goods products, specializing in metal containers, closures, and plastic packaging.
Silgan Holdings reported revenues of $1.32 billion, down 7.1% year on year, falling short of analysts' expectations by 4.1%. It was a weak quarter for the company with a miss of analysts' organic revenue estimates.
As expected, the stock is down 2.3% since the results and currently trades at $45.62.
Berry Global Group (NYSE:BERY) Founded as Imperial Plastics, Berry Global (NYSE: BERY) is a manufacturer and marketer of plastic packaging products, including containers, bottles, and prescription packaging.
Berry Global Group reported revenues of $3.08 billion, down 6.4% year on year, falling short of analysts' expectations by 2.1%. Overall, it was a weak quarter for the company with a miss of analysts' organic revenue estimates.
The stock is up 4.9% since reporting and currently trades at $64.27.
Graphic Packaging Holding (NYSE:GPK) Founded in 1991, Graphic Packaging (NYSE:GPK) is a provider of paper-based packaging solutions for a wide range of products.
Graphic Packaging Holding reported revenues of $2.26 billion, down 7.3% year on year, falling short of analysts' expectations by 5.1%. More broadly, it was a weak quarter for the company with a miss of analysts' volume estimates and underwhelming EBITDA guidance for the full year.
The stock is flat since reporting and currently trades at $27.94.
This content was originally published on Stock Story
