Head-To-Head Review: AptarGroup (NYSE:ATR) and Packaging Corporation of America (NYSE:PKG)

Packaging Corporation of America (NYSE:PKG) and AptarGroup (NYSE:ATR) are both industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, earnings, profitability, analyst recommendations, institutional ownership and dividends.

Dividends

Packaging Corporation of America pays an annual dividend of $5.00 per share and has a dividend yield of 2.7%. AptarGroup pays an annual dividend of $1.80 per share and has a dividend yield of 1.2%. Packaging Corporation of America pays out 52.3% of its earnings in the form of a dividend. AptarGroup pays out 32.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. AptarGroup has increased its dividend for 31 consecutive years.

Institutional and Insider Ownership

89.8% of Packaging Corporation of America shares are owned by institutional investors. Comparatively, 88.5% of AptarGroup shares are owned by institutional investors. 1.5% of Packaging Corporation of America shares are owned by company insiders. Comparatively, 0.7% of AptarGroup shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Packaging Corporation of America and AptarGroup”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Packaging Corporation of America	$8.38 billion	2.01	$805.10 million	$9.56	19.56
AptarGroup	$3.58 billion	2.77	$374.54 million	$5.48	27.40

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

Risk & Volatility

Packaging Corporation of America has a beta of 0.84, suggesting that its stock price is 16% less volatile than the S&P 500. Comparatively, AptarGroup has a beta of 0.59, suggesting that its stock price is 41% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Packaging Corporation of America	10.09%	20.08%	9.77%
AptarGroup	10.41%	15.10%	8.37%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Packaging Corporation of America and AptarGroup, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Packaging Corporation of America	0	4	1	1	2.50
AptarGroup	0	1	4	1	3.00

Packaging Corporation of America presently has a consensus price target of $211.80, suggesting a potential upside of 13.29%. AptarGroup has a consensus price target of $178.60, suggesting a potential upside of 18.96%. Given AptarGroup’s stronger consensus rating and higher probable upside, analysts plainly believe AptarGroup is more favorable than Packaging Corporation of America.

Summary

Packaging Corporation of America beats AptarGroup on 9 of the 17 factors compared between the two stocks.

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.

About AptarGroup

AptarGroup, Inc. designs and manufactures a range of drug delivery, consumer product dispensing, and active material science solutions and services for the pharmaceutical, beauty, personal care, home care, and food and beverage markets. The company operates through Aptar Pharma, Aptar Beauty, and Aptar Closures segments. It also provides pumps for nasal allergy treatments; and metered dose inhaler valves for respiratory ailments, such as asthma and chronic obstructive pulmonary diseases; elastomer for injectable primary packaging components; and active material science solutions. In addition, the company offers dispensing pumps, closures, elastomeric components, and aerosol valves to the digital health solutions. It primarily sells its products and services in Asia, Europe, Latin America, and North America. AptarGroup, Inc. was incorporated in 1992 and is headquartered in Crystal Lake, Illinois.