Last week, you might have seen that Packaging Corporation of America (NYSE:PKG) released its quarterly result to the market. The early response was not positive, with shares down 4.3% to US$171 in the past week. It was a pretty mixed result, with revenues beating expectations to hit US$2.0b. Statutory earnings fell 2.2% short of analyst forecasts, reaching US$1.63 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Packaging Corporation of America  earnings-and-revenue-growth

After the latest results, the eight analysts covering Packaging Corporation of America are now predicting revenues of US$8.02b in 2024. If met, this would reflect an okay 2.7% improvement in revenue compared to the last 12 months. Per-share earnings are expected to accumulate 2.7% to US$8.26. In the lead-up to this report, the analysts had been modelling revenues of US$7.95b and earnings per share (EPS) of US$8.85 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at US$175, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Packaging Corporation of America, with the most bullish analyst valuing it at US$197 and the most bearish at US$123 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 3.6% growth on an annualised basis. That is in line with its 4.3% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 2.6% annually. So it's pretty clear that Packaging Corporation of America is forecast to grow substantially faster than its industry.



The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$175, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Packaging Corporation of America going out to 2026, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted  2 warning signs for Packaging Corporation of America  you should know about.

Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.