Packaging Corporation of America

PKG

Consumer CyclicalPackaging & ContainersNYSE

$223.43

Market Cap: $19.93B

Packaging Corporation of America (PKG) Valuation Summary

Updated May 9, 2026 07:47

Model	Range	Fair Value	Upside
▸ Discounted Cash Flow
Growth Exit 5Y	$117.55 – $606.73	$208.27	-6.8%
Growth Exit 10Y	$130.69 – $618.83	$222.33	-0.5%
EBITDA Exit 5Y	$127.13 – $343.54	$226.15	+1.2%
EBITDA Exit 10Y	$136.44 – $366.98	$234.24	+4.8%
▸ Trading Multiples
P/E	$152.18 – $268.61	$172.63	-22.7%
EV/EBITDA	$118.77 – $319.66	$164.37	-26.4%
EV/Revenue	$66.59 – $120.18	$91.81	-58.9%
▸ PEG
PEG Fair Value	$207.89 – $207.89	$207.89	-7.0%
▸ Earnings Power Value
Earnings Power Value	$68.85 – $127.01	$91.92	-58.9%
▸ Dividend Discount
Dividend Discount	$79.31 – $189.84	$115.55	-48.3%

Valuation History

DCF Analysis

Fair Value

$208.27

Market Price

$223.43

Upside / Downside

-6.8%

Verdict

Overvalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Packaging Corporation of America's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 10.1% to 3.8% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 50, DPO 24, DIO 60). At a 7.3% WACC with mid-year discounting, the terminal value (80% of enterprise value) is derived from the Gordon Growth Model on Year 6 FCFF at a 2.5% perpetual rate. After subtracting net debt, the equity value implies a fair price of $208.27 per share, suggesting PKG is fairly valued by 6.8% at the current price of $223.43.

FCFF Present Value Calculation

WACC

7.26%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	1,418	1,491	1,525	1,610	1,671	1,713
(−) Net Interest	96	101	103	109	113	116
(+) D&A	680	720	725	804	853	875
EBITDA	2,194	2,312	2,353	2,523	2,638	2,704

(−) Tax	347	365	373	394	409	419
(−) CapEx	807	848	867	916	951	975
(−) ΔWC	5	108	51	126	92	94
Free Cash Flow (FCFF)	1,036	991	1,062	1,087	1,186	1,216

Terminal Value						25,549
WACC / Discount Rate	7.3%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	1,000	892	891	851	865	17,997

Enterprise Value	22,497
Projection Period	4,500	20.0%
Terminal Value	17,997	80.0%

(−) Current Net Debt	3,836

Equity Value	18,661
(/) Outstanding Shares	90

Fair Price	$208.27

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.3%	$289	$332	$390	$475	$607
6.3%	$219	$244	$275	$316	$372
7.3%	$173	$189	$208	$232	$262
8.3%	$141	$152	$165	$180	$198
9.3%	$118	$125	$134	$144	$157

Current price: $223.43. Green = undervalued, Red = overvalued.

Fair Value

$222.33

Market Price

$223.43

Upside / Downside

-0.5%

Verdict

Overvalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Packaging Corporation of America's cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from 10.1% to 3.1% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 50, DPO 24, DIO 60). At a 7.3% WACC with mid-year discounting, the terminal value (65% of enterprise value) is derived from the Gordon Growth Model on Year 11 FCFF at a 2.5% perpetual rate. After subtracting net debt, the equity value implies a fair price of $222.33 per share, suggesting PKG is fairly valued by 0.5% at the current price of $223.43.

FCFF Present Value Calculation

WACC

7.26%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	1,418	1,491	1,525	1,610	1,671	1,733	1,795	1,856	1,917	1,978	2,027
(−) Net Interest	96	101	103	109	113	117	122	126	130	134	137
(+) D&A	680	720	725	804	853	878	914	948	986	1,021	1,047
EBITDA	2,194	2,312	2,353	2,523	2,638	2,729	2,830	2,931	3,033	3,133	3,211

(−) Tax	347	365	373	394	409	424	439	454	469	484	496
(−) CapEx	807	848	867	916	951	986	1,021	1,056	1,091	1,125	1,153
(−) ΔWC	5	108	51	126	92	92	92	91	91	90	92
Free Cash Flow (FCFF)	1,036	991	1,062	1,087	1,186	1,226	1,278	1,329	1,383	1,434	1,470

Terminal Value											30,891
WACC / Discount Rate	7.3%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	1,000	892	891	851	865	834	811	786	762	737	15,328

Enterprise Value	23,757
Projection Period	8,429	35.5%
Terminal Value	15,328	64.5%

(−) Current Net Debt	3,836

Equity Value	19,921
(/) Outstanding Shares	90

Fair Price	$222.33

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.3%	$322	$362	$416	$495	$619
6.3%	$243	$266	$293	$330	$380
7.3%	$193	$206	$222	$242	$268
8.3%	$157	$166	$176	$188	$203
9.3%	$131	$137	$144	$152	$161

Current price: $223.43. Green = undervalued, Red = overvalued.

Fair Value

$226.15

Market Price

$223.43

Upside / Downside

+1.2%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Packaging Corporation of America's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 10.1% to 3.8% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 50, DPO 24, DIO 60). At a 7.3% WACC with mid-year discounting, the terminal value (81% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 10.3x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $226.15 per share, suggesting PKG is fairly valued by 1.2% at the current price of $223.43.

FCFF Present Value Calculation

WACC

7.26%

3% – 20%

EV/EBITDA Exit Multiple

10.29x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	1,418	1,491	1,525	1,610	1,671	1,713
(−) Net Interest	96	101	103	109	113	116
(+) D&A	680	720	725	804	853	875
EBITDA	2,194	2,312	2,353	2,523	2,638	2,704

(−) Tax	347	365	373	394	409	—
(−) CapEx	807	848	867	916	951	—
(−) ΔWC	5	108	51	126	92	—
Free Cash Flow (FCF)	1,036	991	1,062	1,087	1,186	—

Peers' EBITDA Multiple						10.3x
Terminal Value						27,825
WACC / Discount Rate	7.26%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	1,000	892	891	851	865	19,600

Enterprise Value	24,099
Projection Period	4,500	18.7%
Terminal Value	19,600	81.3%

(−) Current Net Debt	3,836
Equity Value	20,263
(÷) Outstanding Shares	90M
Fair Price	$226	+1.2%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	6.3x	8.3x	10.3x	12.3x	14.3x
5.3%	$157	$203	$250	$297	$344
6.3%	$149	$193	$238	$282	$327
7.3%	$141	$184	$226	$269	$311
8.3%	$134	$175	$215	$256	$296
9.3%	$127	$166	$205	$243	$282

Current price: $223.43. Green = undervalued, Red = overvalued.

Based on default parameters

Fair Value

$234.24

Market Price

$223.43

Upside / Downside

+4.8%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Packaging Corporation of America's cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from 10.1% to 3.1% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 50, DPO 24, DIO 60). At a 7.3% WACC with mid-year discounting, the terminal value (66% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 10.3x to Year 11 EBITDA. After subtracting net debt, the equity value implies a fair price of $234.24 per share, suggesting PKG is fairly valued by 4.8% at the current price of $223.43.

FCFF Present Value Calculation

WACC

7.26%

3% – 20%

EV/EBITDA Exit Multiple

10.29x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	1,418	1,491	1,525	1,610	1,671	1,733	1,795	1,856	1,917	1,978	2,027
(−) Net Interest	96	101	103	109	113	117	122	126	130	134	137
(+) D&A	680	720	725	804	853	878	914	948	986	1,021	1,047
EBITDA	2,194	2,312	2,353	2,523	2,638	2,729	2,830	2,931	3,033	3,133	3,211

(−) Tax	347	365	373	394	409	424	439	454	469	484	—
(−) CapEx	807	848	867	916	951	986	1,021	1,056	1,091	1,125	—
(−) ΔWC	5	108	51	126	92	92	92	91	91	90	—
Free Cash Flow (FCF)	1,036	991	1,062	1,087	1,186	1,226	1,278	1,329	1,383	1,434	—

Peers' EBITDA Multiple											10.3x
Terminal Value											33,042
WACC / Discount Rate	7.26%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	1,000	892	891	851	865	834	811	786	762	737	16,395

Enterprise Value	24,824
Projection Period	8,429	34.0%
Terminal Value	16,395	66.0%

(−) Current Net Debt	3,836
Equity Value	20,988
(÷) Outstanding Shares	90M
Fair Price	$234	+4.8%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	6.3x	8.3x	10.3x	12.3x	14.3x
5.3%	$195	$238	$281	$324	$367
6.3%	$178	$217	$257	$296	$335
7.3%	$163	$199	$234	$270	$305
8.3%	$149	$182	$214	$246	$279
9.3%	$136	$166	$196	$225	$255

Current price: $223.43. Green = undervalued, Red = overvalued.

Based on default parameters

Trading Multiples

Fair Value

$172.63

Market Price

$223.43

Upside / Downside

-22.7%

Verdict

Overvalued

Using the industry peer median P/E Multiples multiple (trailing + forward), Packaging Corporation of America (PKG) has a fair value of $172.63 based on 8 comparable companies in the Packaging & Containers industry.

P/E Valuation — Packaging & Containers

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing P/E	Forward P/E
Packaging Corporation of AmericaPKG	20,019	26.0x	22.5x
Smurfit Westrock PlcSW	21,833	31.3x	17.4x
Burlington Stores, Inc.BURL	19,132	32.0x	31.1x
DICK'S Sporting Goods, Inc.DKS	18,773	22.6x	15.8x
Amcor plcAMCR	18,449	25.0x	11.0x
Yum China Holdings, Inc.YUMC	16,896	19.2x	20.8x
Ball CorporationBALL	15,581	17.7x	18.7x
Best Buy Co., Inc.BBY	12,446	11.8x	9.2x
Crown Holdings, Inc.CCK	11,308	15.9x	16.0x
Industry Median		20.9x	16.7x
(*) Profit after tax		769	890
Equity Value		16,106	14,830
(/) Outstanding shares		90	90
Fair Price		$180	$166

Selected Fair Value (avg of trailing + forward)

$172.63

-22.7%

Fair Value

$164.37

Market Price

$223.43

Upside / Downside

-26.4%

Verdict

Overvalued

Using the industry peer median EV/EBITDA multiple (trailing + forward), Packaging Corporation of America (PKG) has a fair value of $164.37 based on 9 comparable companies in the Packaging & Containers industry.

EV/EBITDA Valuation — Packaging & Containers

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/EBITDA	Forward EV/EBITDA
Packaging Corporation of AmericaPKG	20,019	13.6x	13.4x
Smurfit Westrock PlcSW	21,833	7.3x	7.1x
Burlington Stores, Inc.BURL	19,132	18.9x	19.0x
DICK'S Sporting Goods, Inc.DKS	18,773	13.8x	10.7x
Amcor plcAMCR	18,449	18.5x	18.4x
Yum China Holdings, Inc.YUMC	16,896	10.3x	10.7x
Ball CorporationBALL	15,581	10.2x	11.3x
Genuine Parts CompanyGPC	14,569	29.7x	29.7x
Best Buy Co., Inc.BBY	12,446	6.5x	6.5x
Crown Holdings, Inc.CCK	11,308	8.2x	8.6x
Industry Median		10.3x	10.7x
(*) EBITDA		1,760	1,777
= Enterprise Value		18,107	19,020
(-) Net Debt		3,836	3,836
Equity Value		14,271	15,184
(/) Outstanding shares		90	90
Fair Price		$159	$169

Selected Fair Value (avg of trailing + forward)

$164.37

-26.4%

Fair Value

$91.81

Market Price

$223.43

Upside / Downside

-58.9%

Verdict

Overvalued

Using the industry peer median EV/Revenue multiple (trailing + forward), Packaging Corporation of America (PKG) has a fair value of $91.81 based on 10 comparable companies in the Packaging & Containers industry.

EV/Revenue Valuation — Packaging & Containers

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/Revenue	Forward EV/Revenue
Packaging Corporation of AmericaPKG	20,019	2.7x	2.6x
Smurfit Westrock PlcSW	21,833	1.1x	1.1x
Burlington Stores, Inc.BURL	19,132	2.1x	2.1x
DICK'S Sporting Goods, Inc.DKS	18,773	1.5x	1.1x
Amcor plcAMCR	18,449	2.2x	2.2x
International Paper CompanyIP	17,489	1.1x	1.1x
Yum China Holdings, Inc.YUMC	16,896	1.6x	1.7x
Ball CorporationBALL	15,581	1.6x	1.8x
Genuine Parts CompanyGPC	14,569	0.9x	0.9x
Best Buy Co., Inc.BBY	12,446	0.4x	0.4x
Crown Holdings, Inc.CCK	11,308	1.3x	1.4x
Industry Median		1.4x	1.3x
(*) Revenue		8,989	9,080
= Enterprise Value		12,606	11,519
(-) Net Debt		3,836	3,836
Equity Value		8,770	7,683
(/) Outstanding shares		90	90
Fair Price		$98	$86

Selected Fair Value (avg of trailing + forward)

$91.81

-58.9%

PEG Fair Value

Fair Value

$207.89

Market Price

$223.43

Upside / Downside

-7.0%

Verdict

Overvalued

Using the PEG framework with analyst consensus forward EPS growth of 20.2% plus 2.3% dividend yield, the company has a fair value of $207.89 based on NTM EPS (FY2026) of $10.29. The current PEG ratio is 1.07.

PEG Ratio

1.07Fair Value

01.02.03.0+

PEG = P/E ÷ (Growth + Yield) = 21.7 ÷ (17.9% + 2.3%) = 1.07

PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.

Growth Category: Fast GrowerPEG highly applicable

PEG is most informative for high-growth companies — the PEG sweet spot.

Fair Value Calculation

EPS Growth RateForward	17.9%
Dividend Yield	+2.3%
Adjusted Growth (clamped 8–25%)	20.2%
Fair P/E	20.2x
NTM EPS (FY2026)	$10.29
Fair Value	$207.89

Growth Analysis

Forward GrowthActive

Period	EPS Est.	Growth	Analysts
FY2025 (actual)	$8.58	—	—
FY2026E	$10.29	+20.0%	5
FY2027E	$12.27	+19.2%	8
FY2028E	$13.10	+6.7%	7
FY2029E	$16.60	+26.8%	3

4Y Forward EPS CAGR: 17.9%

Historical Growth

Year	Net Income	EPS	YoY
FY2021	$841.1M	$8.83	—
FY2022	$1.0B	$11.02	+24.8%
FY2023	$765.2M	$8.48	-23.0%
FY2024	$805.1M	$8.93	+5.3%
FY2025	$768.9M	$8.58	-3.9%

4Y Historical EPS CAGR: -0.7%

Earnings Power Value

Fair Value

$91.92

Market Price

$223.43

Upside / Downside

-58.9%

Verdict

Overvalued

Using the Earnings Power Value framework with a WACC of 7.3% and normalized earnings of $876.4M, the company has a fair value of $91.92 per share. The EPV range is $68.85 – $127.01 based on WACC sensitivity (5.8% – 8.8%).

Currency: USD Millions

	Low	Selected	High
Normalized Earnings	876	876	876
(/) WACC	8.8%	7.3%	5.8%
Enterprise Value	10,005	12,072	15,216
(-) Net debt	3,836	3,836	3,836
Equity Value	6,169	8,236	11,380
(/) Outstanding shares	90	90	90
Fair Price	$68.85	$91.92	$127.01

Dividend Discount Model

Fair Value

$115.55

Market Price

$223.43

Upside / Downside

-48.3%

Verdict

Overvalued

Using the Two-Stage Dividend Discount Model with a Cost of Equity of 8.6% and projected dividend growth of 9.7%, the fair value is $115.55 per share. The DDM range is $79.31 – $189.84 based on sensitivity analysis across Cost of Equity and growth rate assumptions.

Dividend Profile

Current DPS

$5.02

Dividend Yield

2.26%

Payout Ratio

58.5%

Dividend Coverage

1.71x

FCF Payout Ratio61.7%

DPS CAGR (4Y)5.7%

Historical Dividends Per Share

Year	DPS	Payout Ratio	YoY Growth
2025	$5.02	58.5%	+0.1%
2024	$5.01	55.7%	-0.0%
2023	$5.02	58.7%	+10.6%
2022	$4.53	40.8%	+12.8%
2021	$4.02	45.2%	—

Dividend Projections (5-Year)

Year	Projected DPS	Growth	Discount Factor	Present Value
2026	$5.51	9.7%	0.9212	$5.07
2027	$6.04	9.7%	0.8487	$5.13
2028	$6.63	9.7%	0.7818	$5.18
2029	$7.27	9.7%	0.7202	$5.24
2030	$7.98	9.7%	0.6635	$5.29
Terminal Value	$8.17 DPS	2.5%		$89.65

PV of Projected Dividends$25.90

PV of Terminal Value$89.65

Fair Value per Share$115.55

Sensitivity Analysis

Fair value under different Cost of Equity (rows) and DPS Growth Rate (columns) assumptions.

Ke \ Growth	7.7%	8.7%	9.7%	10.7%	11.7%
6.6%	$160	$167	$174	$182	$190
7.6%	$128	$133	$139	$145	$151
8.6%	$106	$111	$116	$120	$125
9.6%	$91	$95	$99	$103	$107
10.6%	$79	$83	$86	$90	$93

Disclaimer: Sweet Value Lab provides estimated intrinsic values for informational purposes only. This is not financial advice. All models rely on assumptions that may not reflect future performance. Always do your own research before making investment decisions.

Packaging Corporation of America (PKG) Valuation Summary

Updated May 9, 2026 07:47

Model	Range	Fair Value	Upside
▸ Discounted Cash Flow
Growth Exit 5Y	$117.55 – $606.73	$208.27	-6.8%
Growth Exit 10Y	$130.69 – $618.83	$222.33	-0.5%
EBITDA Exit 5Y	$127.13 – $343.54	$226.15	+1.2%
EBITDA Exit 10Y	$136.44 – $366.98	$234.24	+4.8%
▸ Trading Multiples
P/E	$152.18 – $268.61	$172.63	-22.7%
EV/EBITDA	$118.77 – $319.66	$164.37	-26.4%
EV/Revenue	$66.59 – $120.18	$91.81	-58.9%
▸ PEG
PEG Fair Value	$207.89 – $207.89	$207.89	-7.0%
▸ Earnings Power Value
Earnings Power Value	$68.85 – $127.01	$91.92	-58.9%
▸ Dividend Discount
Dividend Discount	$79.31 – $189.84	$115.55	-48.3%

Valuation History

DCF Analysis

Fair Value

$208.27

Market Price

$223.43

Upside / Downside

-6.8%

Verdict

Overvalued

FCFF Present Value Calculation

WACC

7.26%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	1,418	1,491	1,525	1,610	1,671	1,713
(−) Net Interest	96	101	103	109	113	116
(+) D&A	680	720	725	804	853	875
EBITDA	2,194	2,312	2,353	2,523	2,638	2,704

(−) Tax	347	365	373	394	409	419
(−) CapEx	807	848	867	916	951	975
(−) ΔWC	5	108	51	126	92	94
Free Cash Flow (FCFF)	1,036	991	1,062	1,087	1,186	1,216

Terminal Value						25,549
WACC / Discount Rate	7.3%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	1,000	892	891	851	865	17,997

Enterprise Value	22,497
Projection Period	4,500	20.0%
Terminal Value	17,997	80.0%

(−) Current Net Debt	3,836

Equity Value	18,661
(/) Outstanding Shares	90

Fair Price	$208.27

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.3%	$289	$332	$390	$475	$607
6.3%	$219	$244	$275	$316	$372
7.3%	$173	$189	$208	$232	$262
8.3%	$141	$152	$165	$180	$198
9.3%	$118	$125	$134	$144	$157

Current price: $223.43. Green = undervalued, Red = overvalued.

Fair Value

$222.33

Market Price

$223.43

Upside / Downside

-0.5%

Verdict

Overvalued

FCFF Present Value Calculation

WACC

7.26%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	1,418	1,491	1,525	1,610	1,671	1,733	1,795	1,856	1,917	1,978	2,027
(−) Net Interest	96	101	103	109	113	117	122	126	130	134	137
(+) D&A	680	720	725	804	853	878	914	948	986	1,021	1,047
EBITDA	2,194	2,312	2,353	2,523	2,638	2,729	2,830	2,931	3,033	3,133	3,211

(−) Tax	347	365	373	394	409	424	439	454	469	484	496
(−) CapEx	807	848	867	916	951	986	1,021	1,056	1,091	1,125	1,153
(−) ΔWC	5	108	51	126	92	92	92	91	91	90	92
Free Cash Flow (FCFF)	1,036	991	1,062	1,087	1,186	1,226	1,278	1,329	1,383	1,434	1,470

Terminal Value											30,891
WACC / Discount Rate	7.3%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	1,000	892	891	851	865	834	811	786	762	737	15,328

Enterprise Value	23,757
Projection Period	8,429	35.5%
Terminal Value	15,328	64.5%

(−) Current Net Debt	3,836

Equity Value	19,921
(/) Outstanding Shares	90

Fair Price	$222.33

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
5.3%	$322	$362	$416	$495	$619
6.3%	$243	$266	$293	$330	$380
7.3%	$193	$206	$222	$242	$268
8.3%	$157	$166	$176	$188	$203
9.3%	$131	$137	$144	$152	$161

Current price: $223.43. Green = undervalued, Red = overvalued.

Fair Value

$226.15

Market Price

$223.43

Upside / Downside

+1.2%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Packaging Corporation of America's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 10.1% to 3.8% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 50, DPO 24, DIO 60). At a 7.3% WACC with mid-year discounting, the terminal value (81% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 10.3x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $226.15 per share, suggesting PKG is fairly valued by 1.2% at the current price of $223.43.

FCFF Present Value Calculation

WACC

7.26%

3% – 20%

EV/EBITDA Exit Multiple

10.29x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	1,418	1,491	1,525	1,610	1,671	1,713
(−) Net Interest	96	101	103	109	113	116
(+) D&A	680	720	725	804	853	875
EBITDA	2,194	2,312	2,353	2,523	2,638	2,704

(−) Tax	347	365	373	394	409	—
(−) CapEx	807	848	867	916	951	—
(−) ΔWC	5	108	51	126	92	—
Free Cash Flow (FCF)	1,036	991	1,062	1,087	1,186	—

Peers' EBITDA Multiple						10.3x
Terminal Value						27,825
WACC / Discount Rate	7.26%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	1,000	892	891	851	865	19,600

Enterprise Value	24,099
Projection Period	4,500	18.7%
Terminal Value	19,600	81.3%

(−) Current Net Debt	3,836
Equity Value	20,263
(÷) Outstanding Shares	90M
Fair Price	$226	+1.2%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	6.3x	8.3x	10.3x	12.3x	14.3x
5.3%	$157	$203	$250	$297	$344
6.3%	$149	$193	$238	$282	$327
7.3%	$141	$184	$226	$269	$311
8.3%	$134	$175	$215	$256	$296
9.3%	$127	$166	$205	$243	$282

Current price: $223.43. Green = undervalued, Red = overvalued.

Based on default parameters

Fair Value

$234.24

Market Price

$223.43

Upside / Downside

+4.8%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Packaging Corporation of America's cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from 10.1% to 3.1% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 50, DPO 24, DIO 60). At a 7.3% WACC with mid-year discounting, the terminal value (66% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 10.3x to Year 11 EBITDA. After subtracting net debt, the equity value implies a fair price of $234.24 per share, suggesting PKG is fairly valued by 4.8% at the current price of $223.43.

FCFF Present Value Calculation

WACC

7.26%

3% – 20%

EV/EBITDA Exit Multiple

10.29x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	1,418	1,491	1,525	1,610	1,671	1,733	1,795	1,856	1,917	1,978	2,027
(−) Net Interest	96	101	103	109	113	117	122	126	130	134	137
(+) D&A	680	720	725	804	853	878	914	948	986	1,021	1,047
EBITDA	2,194	2,312	2,353	2,523	2,638	2,729	2,830	2,931	3,033	3,133	3,211

(−) Tax	347	365	373	394	409	424	439	454	469	484	—
(−) CapEx	807	848	867	916	951	986	1,021	1,056	1,091	1,125	—
(−) ΔWC	5	108	51	126	92	92	92	91	91	90	—
Free Cash Flow (FCF)	1,036	991	1,062	1,087	1,186	1,226	1,278	1,329	1,383	1,434	—

Peers' EBITDA Multiple											10.3x
Terminal Value											33,042
WACC / Discount Rate	7.26%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	1,000	892	891	851	865	834	811	786	762	737	16,395

Enterprise Value	24,824
Projection Period	8,429	34.0%
Terminal Value	16,395	66.0%

(−) Current Net Debt	3,836
Equity Value	20,988
(÷) Outstanding Shares	90M
Fair Price	$234	+4.8%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	6.3x	8.3x	10.3x	12.3x	14.3x
5.3%	$195	$238	$281	$324	$367
6.3%	$178	$217	$257	$296	$335
7.3%	$163	$199	$234	$270	$305
8.3%	$149	$182	$214	$246	$279
9.3%	$136	$166	$196	$225	$255

Current price: $223.43. Green = undervalued, Red = overvalued.

Based on default parameters

Trading Multiples

Fair Value

$172.63

Market Price

$223.43

Upside / Downside

-22.7%

Verdict

Overvalued

P/E Valuation — Packaging & Containers

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing P/E	Forward P/E
Packaging Corporation of AmericaPKG	20,019	26.0x	22.5x
Smurfit Westrock PlcSW	21,833	31.3x	17.4x
Burlington Stores, Inc.BURL	19,132	32.0x	31.1x
DICK'S Sporting Goods, Inc.DKS	18,773	22.6x	15.8x
Amcor plcAMCR	18,449	25.0x	11.0x
Yum China Holdings, Inc.YUMC	16,896	19.2x	20.8x
Ball CorporationBALL	15,581	17.7x	18.7x
Best Buy Co., Inc.BBY	12,446	11.8x	9.2x
Crown Holdings, Inc.CCK	11,308	15.9x	16.0x
Industry Median		20.9x	16.7x
(*) Profit after tax		769	890
Equity Value		16,106	14,830
(/) Outstanding shares		90	90
Fair Price		$180	$166

Selected Fair Value (avg of trailing + forward)

$172.63

-22.7%

Fair Value

$164.37

Market Price

$223.43

Upside / Downside

-26.4%

Verdict

Overvalued

EV/EBITDA Valuation — Packaging & Containers

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/EBITDA	Forward EV/EBITDA
Packaging Corporation of AmericaPKG	20,019	13.6x	13.4x
Smurfit Westrock PlcSW	21,833	7.3x	7.1x
Burlington Stores, Inc.BURL	19,132	18.9x	19.0x
DICK'S Sporting Goods, Inc.DKS	18,773	13.8x	10.7x
Amcor plcAMCR	18,449	18.5x	18.4x
Yum China Holdings, Inc.YUMC	16,896	10.3x	10.7x
Ball CorporationBALL	15,581	10.2x	11.3x
Genuine Parts CompanyGPC	14,569	29.7x	29.7x
Best Buy Co., Inc.BBY	12,446	6.5x	6.5x
Crown Holdings, Inc.CCK	11,308	8.2x	8.6x
Industry Median		10.3x	10.7x
(*) EBITDA		1,760	1,777
= Enterprise Value		18,107	19,020
(-) Net Debt		3,836	3,836
Equity Value		14,271	15,184
(/) Outstanding shares		90	90
Fair Price		$159	$169

Selected Fair Value (avg of trailing + forward)

$164.37

-26.4%

Fair Value

$91.81

Market Price

$223.43

Upside / Downside

-58.9%

Verdict

Overvalued

EV/Revenue Valuation — Packaging & Containers

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/Revenue	Forward EV/Revenue
Packaging Corporation of AmericaPKG	20,019	2.7x	2.6x
Smurfit Westrock PlcSW	21,833	1.1x	1.1x
Burlington Stores, Inc.BURL	19,132	2.1x	2.1x
DICK'S Sporting Goods, Inc.DKS	18,773	1.5x	1.1x
Amcor plcAMCR	18,449	2.2x	2.2x
International Paper CompanyIP	17,489	1.1x	1.1x
Yum China Holdings, Inc.YUMC	16,896	1.6x	1.7x
Ball CorporationBALL	15,581	1.6x	1.8x
Genuine Parts CompanyGPC	14,569	0.9x	0.9x
Best Buy Co., Inc.BBY	12,446	0.4x	0.4x
Crown Holdings, Inc.CCK	11,308	1.3x	1.4x
Industry Median		1.4x	1.3x
(*) Revenue		8,989	9,080
= Enterprise Value		12,606	11,519
(-) Net Debt		3,836	3,836
Equity Value		8,770	7,683
(/) Outstanding shares		90	90
Fair Price		$98	$86

Selected Fair Value (avg of trailing + forward)

$91.81

-58.9%

PEG Fair Value

Fair Value

$207.89

Market Price

$223.43

Upside / Downside

-7.0%

Verdict

Overvalued

PEG Ratio

1.07Fair Value

01.02.03.0+

PEG = P/E ÷ (Growth + Yield) = 21.7 ÷ (17.9% + 2.3%) = 1.07

PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.

Growth Category: Fast GrowerPEG highly applicable

PEG is most informative for high-growth companies — the PEG sweet spot.

Fair Value Calculation

EPS Growth RateForward	17.9%
Dividend Yield	+2.3%
Adjusted Growth (clamped 8–25%)	20.2%
Fair P/E	20.2x
NTM EPS (FY2026)	$10.29
Fair Value	$207.89

Growth Analysis

Forward GrowthActive

Period	EPS Est.	Growth	Analysts
FY2025 (actual)	$8.58	—	—
FY2026E	$10.29	+20.0%	5
FY2027E	$12.27	+19.2%	8
FY2028E	$13.10	+6.7%	7
FY2029E	$16.60	+26.8%	3

4Y Forward EPS CAGR: 17.9%

Historical Growth

Year	Net Income	EPS	YoY
FY2021	$841.1M	$8.83	—
FY2022	$1.0B	$11.02	+24.8%
FY2023	$765.2M	$8.48	-23.0%
FY2024	$805.1M	$8.93	+5.3%
FY2025	$768.9M	$8.58	-3.9%

4Y Historical EPS CAGR: -0.7%

Earnings Power Value

Fair Value

$91.92

Market Price

$223.43

Upside / Downside

-58.9%

Verdict

Overvalued

Currency: USD Millions

	Low	Selected	High
Normalized Earnings	876	876	876
(/) WACC	8.8%	7.3%	5.8%
Enterprise Value	10,005	12,072	15,216
(-) Net debt	3,836	3,836	3,836
Equity Value	6,169	8,236	11,380
(/) Outstanding shares	90	90	90
Fair Price	$68.85	$91.92	$127.01

Dividend Discount Model

Fair Value

$115.55

Market Price

$223.43

Upside / Downside

-48.3%

Verdict

Overvalued

Dividend Profile

Current DPS

$5.02

Dividend Yield

2.26%

Payout Ratio

58.5%

Dividend Coverage

1.71x

FCF Payout Ratio61.7%

DPS CAGR (4Y)5.7%

Historical Dividends Per Share

Year	DPS	Payout Ratio	YoY Growth
2025	$5.02	58.5%	+0.1%
2024	$5.01	55.7%	-0.0%
2023	$5.02	58.7%	+10.6%
2022	$4.53	40.8%	+12.8%
2021	$4.02	45.2%	—

Dividend Projections (5-Year)

Year	Projected DPS	Growth	Discount Factor	Present Value
2026	$5.51	9.7%	0.9212	$5.07
2027	$6.04	9.7%	0.8487	$5.13
2028	$6.63	9.7%	0.7818	$5.18
2029	$7.27	9.7%	0.7202	$5.24
2030	$7.98	9.7%	0.6635	$5.29
Terminal Value	$8.17 DPS	2.5%		$89.65

PV of Projected Dividends$25.90

PV of Terminal Value$89.65

Fair Value per Share$115.55

Sensitivity Analysis

Fair value under different Cost of Equity (rows) and DPS Growth Rate (columns) assumptions.

Ke \ Growth	7.7%	8.7%	9.7%	10.7%	11.7%
6.6%	$160	$167	$174	$182	$190
7.6%	$128	$133	$139	$145	$151
8.6%	$106	$111	$116	$120	$125
9.6%	$91	$95	$99	$103	$107
10.6%	$79	$83	$86	$90	$93