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 Crown Holdings (NYSE: CCK) 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 5.1% since the latest earnings results.
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 print exceeded analysts’ expectations by 0.9%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ adjusted operating income estimates.
Unsurprisingly, the stock is down 3.1% since reporting and currently trades at $101.60.
Is now the time to buy Crown Holdings? 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 estimates and a solid beat of analysts’ adjusted operating income estimates.
Ball pulled off 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 7% since reporting. It currently trades at $53.60.
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 a significant miss of analysts’ adjusted operating income estimates and a significant miss of analysts’ EBITDA estimates.
As expected, the stock is down 9.9% since the results and currently trades at $48.36.
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 result topped analysts’ expectations by 1.9%. Overall, it was a very strong quarter as it also put up a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ adjusted operating income estimates.
Sealed Air delivered the highest full-year guidance raise among its peers. The stock is up 2.9% since reporting and currently trades at $29.86.
Read our full, actionable report on Sealed Air here, it’s free.
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 beat analysts’ expectations by 2.1%. It was a very strong quarter as it also logged an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ adjusted operating income estimates.
Graphic Packaging Holding had the slowest revenue growth and weakest full-year guidance update among its peers. The stock is down 1.7% since reporting and currently trades at $22.73.
Read our full, actionable report on Graphic Packaging Holding here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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