Packaging Corporation of America (NYSE:PKG) vs. Ranpak (NYSE:PACK) Head-To-Head Review

Ranpak (NYSE:PACK) and Packaging Corporation of America (NYSE:PKG) are both materials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, risk, dividends and analyst recommendations.

Risk and Volatility

Ranpak has a beta of 3.11, indicating that its share price is 211% more volatile than the S&P 500. Comparatively, Packaging Corporation of America has a beta of 0.76, indicating that its share price is 24% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations for Ranpak and Packaging Corporation of America, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ranpak	1	1	2	0	2.25
Packaging Corporation of America	0	3	6	1	2.80

Ranpak presently has a consensus price target of $3.50, indicating a potential downside of 4.50%. Packaging Corporation of America has a consensus price target of $275.43, indicating a potential upside of 7.37%. Given Packaging Corporation of America’s stronger consensus rating and higher probable upside, analysts clearly believe Packaging Corporation of America is more favorable than Ranpak.

Earnings and Valuation

This table compares Ranpak and Packaging Corporation of America”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ranpak	$395.00 million	0.80	-$38.30 million	($0.40)	-9.16
Packaging Corporation of America	$8.99 billion	2.54	$774.10 million	$8.12	31.59

Packaging Corporation of America has higher revenue and earnings than Ranpak. Ranpak is trading at a lower price-to-earnings ratio than Packaging Corporation of America, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Ranpak and Packaging Corporation of America’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ranpak	-8.28%	-6.65%	-3.15%
Packaging Corporation of America	7.40%	19.43%	8.28%

Insider & Institutional Ownership

85.9% of Ranpak shares are owned by institutional investors. Comparatively, 89.8% of Packaging Corporation of America shares are owned by institutional investors. 8.8% of Ranpak shares are owned by company insiders. Comparatively, 1.6% of Packaging Corporation of America shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Packaging Corporation of America beats Ranpak on 13 of the 15 factors compared between the two stocks.

About Ranpak

Ranpak Holdings Corp., together with its subsidiaries, provides product protection solutions and end-of-line automation solutions for e-commerce and industrial supply chains in North America, Europe, and Asia. The company offers protective packaging solutions, such as void-fill protective systems that convert paper to fill empty spaces in secondary packages and protect objects under the FillPak brand; cushioning protective systems, which convert paper into cushioning pads under the PadPak brand; and wrapping protective systems that create pads or paper mesh to wrap and protect fragile items, as well as to line boxes and provide separation when shipping various objects under the WrapPak, Geami, and ReadyRoll brands, as well as cold chain products, which are used to provide insulation for goods. It also offers end-of-line packaging automation products, which help end users automate the void filling and box closure processes after product packing is complete. The company sells its products to end users primarily through a distributor network, and directly to select end-users. Ranpak Holdings Corp. was founded in 1972 and is headquartered in Concord Township, Ohio.

About Packaging Corporation of America

Packaging Corporation of America engages in the production of container products. It operates through the following segments: Packaging, Paper, and Corporate and Other. The Packaging segment offers a variety of corrugated packaging products, such as conventional shipping containers. The Paper segment manufactures and sells a range of papers, including communication-based papers, and pressure sensitive papers. The Corporate and Other segment focuses on transportation assets, such as rail cars, and trucks. The company was founded in 1959 and is headquartered in Lake Forest, IL.