What Happened?

Shares of foodservice packaging supplier Karat Packaging (NASDAQ: KRT) fell 14.3% in the afternoon session after the company announced the sale of 1.5 million shares for $27 per share by some members of its management team. The company itself is not selling any shares in this offering and will not receive any proceeds from the sale.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Karat Packaging? Access our full analysis report here, it’s free.

What The Market Is Telling Us

Karat Packaging’s shares are not very volatile and have only had 8 moves greater than 5% over the last year. Moves this big are rare for Karat Packaging and indicate this news significantly impacted the market’s perception of the business.

Karat Packaging is down 11.6% since the beginning of the year, and at $26.39 per share, it is trading 21.1% below its 52-week high of $33.46 from February 2025. Investors who bought $1,000 worth of Karat Packaging’s shares at the IPO in April 2021 would now be looking at an investment worth $1,422.

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