Packaging Corp of America Q2’26 earnings: Solid print, supported by Greif improvements and continued volume outperformance

Research evidence excerpt

Packaging Corp of America Q2’26 earnings: Solid print, supported by Greif improvements and continued volume outperformance

Detlef Winckelmann AC Europe Equity Research

(44-20) 3493-5190 23 July 2026 J P M O R G A N

detlef.winckelmann@jpmorgan.com

Investment Thesis, Valuation and Risks

Packaging Corp of America (Overweight; Price Target: $269.00)

Investment Thesis

Over the last 15 years, corrugated producers have under-invested in their mill assets as

potential returns on new capex have been, and remain, low. At the same time, peer company

margins on their downstream businesses (box plants) were sub-par. Peers International

Paper (IP) and Smurfit WestRock (SW) are both under new management and both have

chosen to embark on value>volume strategies for their box businesses. The most likely

outcomes of these new strategies, in our view, are peers losing box volumes to PKG and peer

paper integration declining. Given this is undesirable, the most likely outcome seems to be

mill capacity closures. As a result of the above, we expect supply additions to be lower than

historically and we would not be surprised to see net closures over the ST-MT. With

operating rates already at 92-93%, further closures likely and demand low versus history,

we see the market tightening in the ST-MT.

Valuation

We set our Dec-27 target price of $269/share for Packaging Corporation of America using

an equal weighting of a one-year forward EV/EBITDA multiple valuation (10.1x) and a

one-year forward free cash flow yield multiple valuation (5.25%). Our multiples take into

account the historical trading levels and adjust for our view on whether the segment/division

is improving/getting worse versus history.

EV/EBITDA valuation FCF yield valuation

$m $m

Multiple Valuation JPMe LTM 31 Dec 2028