Packaging Corp. (PKG), Kapstone (KS) Announces $50 Containerboard Price Hikes - Deutsche Bank (IP) (WRK)
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Packaging Corp. (NYSE: PKG) and Kapstone (NYSE: KS) increased containerboard prices by $50 per ton following news yesterday International Paper (NYSE: IP) increased prices effected October 1st, said Deutsche Bank. WestRock (NYSE: WRK) may also increase prices.
"We assume WRK will also look to increase prices which would represent ~70% of domestic capacity. We expect that producers can drive through a significant portion of this increase in October, but we have not factored an increase into our 2017 earnings estimates as we are not confident such an increase can roll through at the box level on a sustainable basis and will largely depend on input cost inflation and demand trends. That said, we think this news will be a short-term catalyst for the sector. We expect the first point of visibility on the success of this attempt will be the October 21st issue of PPW," said analyst Debbie Jones.
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