The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Graphic Packaging Holding (NYSE: GPK) and the rest of the industrial packaging stocks fared in Q2.
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 8 industrial packaging stocks we track reported a mixed Q2. As a group, revenues beat analysts’ consensus estimates by 1.6%.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 7.5% since the latest earnings results.
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 $2.20 billion, down 1.5% year on year. This print exceeded analysts’ expectations by 2.1%. Overall, it was a very strong quarter for the company with an impressive beat of analysts’ EBITDA estimates.
Michael Doss, the Company's President and CEO said, "Promotional activity drove modestly better than expected volumes in the second quarter. Conversations with our customers suggest potential for increased emphasis on volume growth and protecting share in the year ahead. As these customers refine their strategies, we are working closely with them to support their plans.
Graphic Packaging Holding delivered the slowest revenue growth and weakest full-year guidance update of the whole group. Unsurprisingly, the stock is down 11.9% since reporting and currently trades at $20.38.
Is now the time to buy Graphic Packaging Holding? Access our full analysis of the earnings results here, it’s free.
Best Q2: Ball (NYSE: BALL)
Started with a $200 loan in 1880, Ball (NYSE: BLL) manufactures aluminum packaging for beverages, personal care, and household products as well as aerospace systems and other technologies.
Ball reported revenues of $3.34 billion, up 12.8% year on year, outperforming analysts’ expectations by 7%. The business had an exceptional quarter with an impressive beat of analysts’ organic revenue and adjusted operating income estimates.
Ball achieved the biggest analyst estimates beat among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 13.7% since reporting. It currently trades at $49.73.
Is now the time to buy Ball? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: International Paper (NYSE: IP)
Established in 1898, International Paper (NYSE: IP) produces containerboard, pulp, paper, and materials used in packaging and printing applications.
International Paper reported revenues of $6.77 billion, up 42.9% year on year, exceeding analysts’ expectations by 1.9%. Still, it was a softer quarter as it posted and a significant miss of analysts’ adjusted operating income estimates.
As expected, the stock is down 14.9% since the results and currently trades at $45.71.
Read our full analysis of International Paper’s results here.
Sealed Air (NYSE: SEE)
Founded in 1960, Sealed Air Corporation (NYSE: SEE) specializes in the development and production of protective and food packaging solutions, serving a variety of industries.
Sealed Air reported revenues of $1.34 billion, flat year on year. This print surpassed analysts’ expectations by 1.9%. It was a very strong quarter as it also produced a solid beat of analysts’ EBITDA estimates.
Sealed Air scored the highest full-year guidance raise among its peers. The stock is up 16.8% since reporting and currently trades at $33.87.
Read our full, actionable report on Sealed Air here, it’s free.
Crown Holdings (NYSE: CCK)
Formerly Crown Cork & Seal, Crown Holdings (NYSE: CCK) produces packaging products for consumer marketing companies, including food, beverage, household, and industrial products.
Crown Holdings reported revenues of $3.15 billion, up 3.6% year on year. This number beat analysts’ expectations by 0.9%. Overall, it was a very strong quarter as it also put up an impressive beat of analysts’ EBITDA estimates.
The stock is down 9% since reporting and currently trades at $95.33.
Read our full, actionable report on Crown Holdings here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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