As the Q2 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the industrial packaging industry, including Silgan Holdings (NYSE: SLGN) 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 8 industrial packaging stocks we track reported a mixed Q2. As a group, revenues beat analysts’ consensus estimates by 1.6%.
While some industrial packaging stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 3.8% since the latest earnings results.
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 $1.54 billion, up 11.4% year on year. This print was in line with analysts’ expectations, but overall, it was a slower quarter for the company with full-year EPS guidance missing analysts’ expectations.
"Our businesses continued to execute in the second quarter and delivered significant adjusted EPS growth of 15%, driven by increased organic volumes in our key product categories, strong contributions from the successful integration of the Weener acquisition and continued best-in-class operating performance. Once again, our diverse portfolio, the strength of our teams, our focus on innovation and our disciplined value creation strategy continue to drive our performance and the long-term success of the Company," said Adam Greenlee, President and CEO.
Unsurprisingly, the stock is down 16.1% since reporting and currently trades at $46.80.
Read our full report on Silgan Holdings 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 a solid beat of analysts’ organic revenue estimates and an impressive 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 8.2% since reporting. It currently trades at $52.93.
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 8.8% since the results and currently trades at $48.96.
Read our full analysis of International Paper’s results here.
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%. 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.
The stock is down 4.5% since reporting and currently trades at $100.13.
Read our full, actionable report on Crown Holdings 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 result surpassed analysts’ expectations by 2.1%. Overall, it was a very strong quarter as it also recorded 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 4.1% since reporting and currently trades at $22.19.
Read our full, actionable report on Graphic Packaging Holding here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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