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Packaging Corporation of America (PKG)

NYSE - Nasdaq Real Time Price. Currency in USD
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151.69-3.16 (-2.04%)
At close: 4:00PM EDT
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  • S
    Shorty McShortBear
    Just Sold Short PKG at $142.79. This is a Pure Earnings trade. PKG reports earnings in just a few minutes and I am expecting a weak and disappointing report to be followed by a significant drop in share price.

    Due to Covid as well as ongoing automation of office systems, the use of paper in office environments has been and will continue to decline. PKG derives significant revenue from paper sales. This lost revenue is currently not priced into the stock, nor is it properly factored in for future quarters. I expect today's ER to bring this issue to the forefront and it could easily result in a haircut of 5-12% in stock price occurring as early as tomorrow.

    A very attractive one day opportunity for the astute Pure Earnings trader.

    Good Luck!
  • S
    Shorty McShortBear
    Looks pretty decent at first glance, but the stock is over-valued and I am happy to be Short and to experience the full market reaction to these earnings tomorrow. I still expect a share price drop in response to these numbers.

    Packaging Corp beats by $0.29, beats on revs

    5:34 PM ET 4/26/21

    Reports Q1 (Mar) earnings of $1.77 per share, excluding non-recurring items, $0.29 better than the S&P Capital IQ Consensus of $1.48; revenues rose 5.8% year/year to $1.81 bln vs the $1.71 bln S&P Capital IQ Consensus."Packaging segment demand remained very strong throughout the first quarter as we set a new all-time quarterly record for containerboard volume and matched our all-time quarterly total box shipments record.Outlook: "Looking ahead as we move from the first and into the second quarter...in our Packaging segment we expect demand to remain strong, and we will continue implementing our previously announced price increases. We also expect export prices to move higher. In our Paper segment, we expect volumes to be fairly flat with higher average prices and mix as we continue the roll-out of our recently announced paper price increases."
    Bearish
  • S
    Shorty McShortBear
    PKG is having their Conference Call at 9:00 AM ET. Even though earnings were decent, stock is still overvalued and I am happy to be Short a lot of shares at $142.79. This could easily go down quite a bit today. Look at the pre-market, nobody wants to bid this up, the smart trader knows it is just not worth $143/share considering the fact that both consumer and business demand for paper of all types is on a steep and permanent decline.

    This is one of the many things I love about the Pure Earnings Short Sell game: There are so many ways to win. If a company misses earnings and/or revenue estimates, a dip in price is almost certain. But even if they beat on both, if you chose the right stock, one that is genuinely over-valued and faces headwinds going forward, you still can come out with a nice profit on your Short play.

    Good Luck!
    Bearish
  • S
    Shorty McShortBear
    PKG is going to be my next Pure Earnings Short Sell play. Gonna sell ACI for a loss within the next two hours, probably just before market close, and then immediately Short PKG with a lot of $$, ahead of her earnings release which happens after market close.

    PKG is grossly overvalued and should deliver a weak and disappointing earnings release that should result in a 5-12% price haircut tomorrow. To be a great trader you must understand human psychology. The overvaluation of PKG is two-fold: First it is based upon the Irrational Exuberance of the stock market as a whole, but second, it is compounded by the fact that traders love to adopt a "glass half full" attitude towards company facts.

    The facts on PKG are that the company is dependent upon TWO distinct revenue sources: 1) Sales of packaging material. 2) Sales of paper. And, while sales of packaging material should be quite healthy, sales of paper have been and will continue to be in decline. But traders continue to focus on the former and not on the latter, resulting in an unsustainable price bubble that should burst with today's earnings release numbers.

    While there are several nice looking Pure Earnings Short Sell plays for today, PKG stands out to me as the MOST likely to sell off, and the most likely to see a decline of at least 5% and very possibly 10+% in price from her current $143 level.

    Good Luck!
    Bearish
  • L
    Len
    Is 3M buying GPK?
    GPK has strong earnings and a new target upgrade by Goldman.
    Why does not PKG buy GPK?
  • c
    capKirk
    19% Earning surprise...Gonna be a good day tomorrow. Add to your positions longs...
    Bullish
  • S
    Shorty McShortBear
    Covered my PKG Short Sell at $144.60 for my 3rd consecutive losing trade. Moving on to a Short Sell of FEYE. If things work out the way I think they will, I could make back all the money I lost on these past three trades, on a huge drop of 10+% by FEYE tomorrow. We shall see just how right (or perhaps not) I am. :-)
    Neutral
  • S
    Shorty McShortBear
    I got a Bid in to Cover my PKG Short at $133.51. Not expecting it to fill, but right now in the PM, 9:17 ET, nobody wants to pay anything more for this. So, I give it a shot and lets see what happens... :-)
    Bearish
  • S
    Son of Kong
    Any reason for massive drop today?? I'm not seeing ANY news. I know they went X-div. on Friday, and yes we have a large Market drop again today!!
  • J
    Jabberwonky
    PKG looks like a really good buy. However, one thing bothers me-"7% of our total sales and 47% of paper segment sales revenue comes from OFFICE DEPOT." Well, it's pretty obvious OD will not be around much longer, it's in a nosedive. It would seem they would not wait for this to happen to find a new customer.
  • S
    Son of Kong
    Holy Toledo, PKG is getting sheared AGAIN today, down almost 3%!!! Last thing I expected with a booming economy and booming package business!!! Love to buy more, but more downside likely ahead with overall Market really just beginning to roll over. I don't think earnings are going to save us this time....
  • G
    Gerry
    Got to say it again.......why would anyone want to own this stock? The 3rd quarter commentary is the same as the 2nd quarter which was the same as the 1st quarter commentary.
    1. We beat by one penny (adj) per share.
    2. Weather affected us
    3. We are still seeing price declines, or feeling their effects
    4. We still have inventory issues.
    5. Took excessive downtime for maintenance.
    6. We are running our machines efficiently to match market supply and demand.

    I guess you can take this write up and cut & paste it into the 4Q report. You're welcome.
  • D
    Diane
    F.Y.I. This company has been acquired (purchased) by CBBT based in California. The sale should be complete by end of Dec 2020 according to the CEO of CBBT.

    Google that and you'll see!
    Bullish
  • S
    Son of Kong
    Looks like PKG beat earnings expectations. Not seeing anything yet on the wires.
  • S
    Son of Kong
    I have no idea WHY PKG is selling off so VICIOUSLY this morning considering they handily beat on both revenues and earnings. Could be a Sell the News scenario!! Well, that being said, I rebought the stock in the mid 121s a few seconds ago. With firms having tons of trouble getting trucks to make deliveries as reported several days ago in Wall Street journal, indicating a BOOMING economy, PKG should continue to do VERY WELL going forward!!!
  • J
    Jabberwonky
    WTH! Omg, I almost bought this a week ago. whew, this is not good. Westrock too.
  • S
    Son of Kong
    PKG looks like its starting a new leg downtown!! If we are lucky, its trying to put in a double bottom!! If things continue to degrade, we could easily see 80 bucks (unbelievable!!). Still have PLENTY of dry powder to buy more. This is an Excellent corporation, and will continue to do VERY WELL in this expanding economy!!!
  • S
    Son of Kong
    Rick, were you a buyer today?? Give me something!!
  • J
    John
    anyone know PKG Client list?
  • S
    Son of Kong
    Okay, finally have the news that's fit to Print: PKG beats earnings estimates by 2 cents, and barely falls short of revenues. That's four quarters in a row where they beat earnings!! Great job PKG!!!