Packaging Corp Of America (PKG) Financial Statements

Packaging Corp of America's financial quality is a mix of solid and moderate indicators. The company shows respectable profitability with an 8.6% profit margin and a 12.3% operating margin, though we lack gross margin data for a full assessment. Its Return on Equity (ROE) of 16.8% is near the lower end of the framework's high-quality threshold of 15-20%. Revenue growth of 10.1% YoY is positive but falls short of the double-digit, consistent growth often associated with high-quality compounders. Free cash flow generation, while positive, appears modest with a 3.8% FCF yield, which is below the framework's favourable benchmark of >10-15% FCF margin. The balance sheet is a relative strength, with a Debt/Equity ratio of 0.95 indicating manageable leverage, comfortably below the framework's cautionary level of Debt/EBITDA > 1.0x. The dividend yield of 2.34% provides a return component. Overall, the company presents as a financially stable operator with adequate returns and a prudent capital structure, but its growth trajectory and cash conversion do not meet the high benchmarks for a standout quality compounder under the GoodMoat framework. Analysis based on data as of 2024-05-15.