The combined Rock-Tenn and MeadWestvaco will have sales nearly twice as high as their next largest publicly traded U.S. competitor, but investors might want to take a look at Packaging Corp. of America, which has greatly outperformed the rest of the sector over the past five years.
Rock-Tenn Corp. RKT, +6.13% of Norcross, Ga., and MeadWestvaco Corp. MWV, +14.01% of Richmond, Va., announced a merger on Monday, which sent shares of Rock-Tenn up as much as 12%, while MeadWestvacos stock was up as much as 20%.
While MeadWestvaco had considerably lower sales than Rock-Tenn during 2014 and a lower market capitalization when the market closed on Friday, the companys shareholders will wind up holding 50.1% of the yet-to-be named new companys stock. But Rock-Tenns CEO Steven C. Voorhees will be the CEO of the combined company.
The combined companys net sales for 2014 came to $15.7 billion, which was nearly twice as high as the sales of the next largest U.S. competitor. The companies expect the combination to lead to $300 million in annual cost savings over the next three years.
Heres a list of all 13 S&P 1500 stocks in the Containers/Packaging subsector, with the merging companies at the top, followed by the rest, ranked by sales for the past 12 reported months (most havent yet announced results for the fourth quarter of 2014):
In comparison to those total returns, the S&P 1500 Composite Index returned 13% during 2014. The three-year total return for the index through Friday was 110% and the five-year return was 121%.
MeadWestvaco was last years best performer among the group, but Packaging Corp. of America PKG, +1.87% of Lake Forest, Ill., ran a close second and has run way ahead of the pack with a three-year return of 227% and a five-year return of 333%.
Packaging Corp of America acquired Boise Inc. in December 2013 for $2.1 billion, which helped it grow net sales for the first three quarters of 2014 by 84% to $4.42 billion. The company will announce its fourth-quarter results today, after the market close.
Packaging Corp. of America expects the Boise acquisition to lead to $175 million in annual cost savings by the end of 2016. The company said its annual run rate for cost savings had climbed to roughly $110 million at the end of the third quarter. The cost cutting is very important to investors, as PKGs operating profit margin for the third quarter declined to 12.4% from 16.9% a year earlier.
The strength of PKGs stock has reflected five years of strong sales growth, and 2015 should be a good one for the company. For starters, the decline in gasoline prices is lowering its transportation costs and freeing up more consumer cash that could be spent on packaged products, which will help most packaging manufactures. But Packaging Corp. of America will also have a boost to production, because it recently completed the conversion of its newsprint manufacturing facility in DeRidder, La., to containerboard manufacturing.
Read this article:
Deep Dive: Packaging giants merger sheds light on this outperforming stock
- 'Yes, Eddie Van Halen Was Anxious': Wolfgang Sheds Light On His Father's Controversial Decision For Van Halen - Ultimate Guitar - June 12th, 2025 [June 12th, 2025]
- Amazon Is Selling This $180 Metal Storage Shed for Only $80 Right Now, and It's 'Perfect' for Stashing Yard Tools - Men's Journal - June 12th, 2025 [June 12th, 2025]
- Firefighters swiftly contain maintenance shed blaze in Henderson - KSNV - June 12th, 2025 [June 12th, 2025]
- Italian researcher sheds light on the lasting psychiatric impact of childhood trauma - News-Medical - June 12th, 2025 [June 12th, 2025]
- New glacier discovery sheds light on Earth's origins - MSN - June 12th, 2025 [June 12th, 2025]
- UVA research sheds light on triggers of out-of-body experiences - Cville Right Now - June 12th, 2025 [June 12th, 2025]
- New HoYoverse Listing Sheds Light on Next Game from Genshin Impact Developer - ComicBook.com - June 12th, 2025 [June 12th, 2025]
- A tragic death; its aftermath that sheds light - The Long Island Advance - June 12th, 2025 [June 12th, 2025]
- U.S. Smuggling Trial Sheds Light on Iranian Arms Trafficking - The Maritime Executive - June 12th, 2025 [June 12th, 2025]
- Circuit Clerks Office sheds light on a Scam that has been circulating via Text - Z93 Country - June 12th, 2025 [June 12th, 2025]
- AI sheds light on bird collisions at offshore wind farms - group.vattenfall.com - June 12th, 2025 [June 12th, 2025]
- Unravelling the origins of cosmic rays: MSU research sheds light on century-old mystery - Innovation News Network - June 12th, 2025 [June 12th, 2025]
- Italian researcher sheds light on the lasting psychiatric impact of childhood trauma - MSN - June 12th, 2025 [June 12th, 2025]
- Discovery of Gpr45 gene activity in brain cilia sheds light on genetic roots of overeating - Medical Xpress - June 12th, 2025 [June 12th, 2025]
- First named pterosaur from Japan sheds light on ancient flying reptiles - Phys.org - June 12th, 2025 [June 12th, 2025]
- Underwater Images of Coins Sheds Light on San Jos Galleon, the Holy Grail of Shipwrecks - GreekReporter.com - June 12th, 2025 [June 12th, 2025]
- Broward Sheriff report sheds new light on inmate fight that led to deputies arrests - Sun Sentinel - June 12th, 2025 [June 12th, 2025]
- Parents forced 3-year-old boy to live in dirty shed without electricity and running water for weeks, cops say - Law and Crime News - June 12th, 2025 [June 12th, 2025]
- Seminole County Fire Department: 9 dogs killed in a shed fire that spread to a kennel in Altamonte Springs - Headline Surfer - June 12th, 2025 [June 12th, 2025]
- Will Neymar Stay at Santos? His Father Sheds Light on the Brazilian Stars Future - beIN SPORTS - June 12th, 2025 [June 12th, 2025]
- In the News: David Alexander Sheds Light on Social Pressures - Newsroom | University of St. Thomas - May 28th, 2025 [May 28th, 2025]
- Sunday Fire Causes Extensive Damage to Town of Herman Shed - whbl.com - May 28th, 2025 [May 28th, 2025]
- Genetic discovery sheds light on infection-triggered neuropathy - News-Medical - May 28th, 2025 [May 28th, 2025]
- Veteran sheds light on the importance of mental health research - VA News (.gov) - May 28th, 2025 [May 28th, 2025]
- Expos sheds light on shocking truth behind popular fashion brand's operations: 'We have no choice' - The Cool Down - May 28th, 2025 [May 28th, 2025]
- The Fed sheds one of its three big threats - Financial Times - May 28th, 2025 [May 28th, 2025]
- Rafael Nadal sheds tears in emotional French Open ceremony with Roger Federer, Novak Djokovic and Andy Murray - Yahoo Sports - May 28th, 2025 [May 28th, 2025]
- NBA Insider Sheds Light on 16-Year Veterans Future - Sports Illustrated - May 28th, 2025 [May 28th, 2025]
- Machine Gun Kelly sheds light on welcoming baby with Megan Fox - The News International - May 28th, 2025 [May 28th, 2025]
- Shopper sheds light on disturbing reality behind trendy thrift store model: 'The reality is hardly this simple or rosy' - The Cool Down - May 28th, 2025 [May 28th, 2025]
- IBM Research Sheds New Light on AI Agents' Impact Across Org Structures, Business Functions - Cloud Wars - May 28th, 2025 [May 28th, 2025]
- Crews respond to early morning shed fire in York County - FOX43 - May 28th, 2025 [May 28th, 2025]
- In a three-hour interview with Joe Rogan, Aaron Rodgers sheds no light on his football future - NBC Sports - May 28th, 2025 [May 28th, 2025]
- Rafael Nadal sheds tears as the 'big four' reunite for Spaniard's farewell party at his beloved Roland Garros - MSN - May 28th, 2025 [May 28th, 2025]
- A new map of Africa sheds light on the origins of enslaved people - Science News Explores - May 28th, 2025 [May 28th, 2025]
- Kyle Richards Sheds New Light on Seeing Mauricio with That Woman: Very Intuitive - Bravo - May 28th, 2025 [May 28th, 2025]
- US Man Addicted To Fast Food Sheds 124 Kg, Reveals Simple Hobby That Transformed His Life - NDTV - May 28th, 2025 [May 28th, 2025]
- Shed catches fire, billows thick smoke - WGAL - May 28th, 2025 [May 28th, 2025]
- The Last Of Us Director Sheds New Light On The First Game's Ending - GameSpot - May 28th, 2025 [May 28th, 2025]
- People warned to 'never' risk removing wasp nests from sheds themselves as they emerge this spring - Nottinghamshire Live - May 28th, 2025 [May 28th, 2025]
- Bill Belichick Sheds Light On Jordon Hudson's 'Business' Role With Him - Sports Illustrated - May 20th, 2025 [May 20th, 2025]
- Deion Sanders sheds tears of pride as Shilo defends Shedeur from hate in emotional family showdown - MotorcycleSports - May 20th, 2025 [May 20th, 2025]
- Walmart is selling a 'quality' $399 outdoor storage shed for $133, and shoppers say it's 'nice and spacious' - autoblog.com - May 20th, 2025 [May 20th, 2025]
- OPINION: How President Raymonds Performance Before the U.S. House Committee Sheds a Concerning Light on the Haverford Community - haverfordclerk.com - May 20th, 2025 [May 20th, 2025]
- Warren Buffett's Berkshire Hathaway Sheds Citi Stake, Trims Other Big Bank Holdings - MSN - May 20th, 2025 [May 20th, 2025]
- 'Fallout' Star Sheds Light on Show's Future With Big Admission - Men's Journal - May 20th, 2025 [May 20th, 2025]
- Rant and Rave: Reader sheds tears of joy over production of Jane Eyre - The Seattle Times - May 20th, 2025 [May 20th, 2025]
- Shai Gilgeous-Alexander sheds stoic approach as he leads Thunder to Game 7 win - Star-Herald - May 20th, 2025 [May 20th, 2025]
- First study of its kind sheds light on pregnancy in the Viking Age - Phys.org - May 20th, 2025 [May 20th, 2025]
- This Powerful Exhibit Sheds Light on 35 Years of Working Class Realities - The Phoblographer - May 20th, 2025 [May 20th, 2025]
- Changes to LL11 Aim to Benefit Boards & Building Owners - New Laws Move NYC Away from Sidewalk Sheds - Cooperator News New York - May 20th, 2025 [May 20th, 2025]
- I shed two stone on weight-loss drugs then got Ozempic tongue - The Independent - May 20th, 2025 [May 20th, 2025]
- What Is Surgical Body Contouring? Expert Sheds Insights On Trend Reshaping Fitness - Zee News - May 20th, 2025 [May 20th, 2025]
- Scientists discover Archaeopteryx fossil that sheds light on the first flight - The Economic Times - May 20th, 2025 [May 20th, 2025]
- Suspect caught naked with Vaseline inside a shed at Slidell Lowe's store, police report - The Daily Advertiser | Lafayette, Louisiana - May 20th, 2025 [May 20th, 2025]
- Essex crews stop shed fires spreading to homes in Loughton - BBC - May 20th, 2025 [May 20th, 2025]
- Fresh information in Netflix documentary sheds new light on the killing of Jason Corbett - The Irish Times - May 20th, 2025 [May 20th, 2025]
- Gold Drops Rs 3,750 This Week, Silver Sheds Rs 826 as Market Volatility Weighs on Bullion Prices - MSN - May 20th, 2025 [May 20th, 2025]
- Will Smith's friend sheds light on their friendship - Geo.tv - May 20th, 2025 [May 20th, 2025]
- Cassies first day on the witness stand sheds more light on freak-offs - TheGrio - May 20th, 2025 [May 20th, 2025]
- Texas mother finds her 2 kids dead in a shed. Police investigate. - mySA - March 1st, 2025 [March 1st, 2025]
- Marvel sheds new light on Death of Silver Surfer #1 - AIPT - March 1st, 2025 [March 1st, 2025]
- Shed old skin: Learn the Year of the Snakes power - FVS News - March 1st, 2025 [March 1st, 2025]
- Provo man charged with killing ex-girlfriend, hiding her bound body in shed - KSL.com - March 1st, 2025 [March 1st, 2025]
- Drew McIntyre Sheds Light On Massive Support He Has Received Behind-The-Scenes In WWE From The Rock - Wrestling Headlines - March 1st, 2025 [March 1st, 2025]
- Costco Wholesale (NASDAQ:COST) sheds 3.4% this week, as yearly returns fall more in line with earnings growth - Yahoo Finance - March 1st, 2025 [March 1st, 2025]
- House of David sheds light on Jonathan's wife as viewers wonder what happened to her - The Mirror US - March 1st, 2025 [March 1st, 2025]
- DOGE in the Dumps: Dogecoin Sheds Most of Its Post-Election Gains - Decrypt - March 1st, 2025 [March 1st, 2025]
- Your Gear Shed Doesn't Have to Look Pretty to Be Practical - Outside - March 1st, 2025 [March 1st, 2025]
- UPDATED: Man arrested after body of missing Springville woman is found in Provo shed - Daily Herald - March 1st, 2025 [March 1st, 2025]
- Rare frescoes unearthed in Pompeii shed light on ancient rituals - Reuters - March 1st, 2025 [March 1st, 2025]
- 53-year-old man arrested after missing woman's body found in Provo shed - FOX 13 News Utah - March 1st, 2025 [March 1st, 2025]
- What to Know About Tax Filing As the IRS Sheds Workers - RealClearMarkets - March 1st, 2025 [March 1st, 2025]
- Joy Reid Sheds Tears On Her Firing While MSNBC Gets Major Backlash - The Root - March 1st, 2025 [March 1st, 2025]
- Theres a body in the shed: Missing woman found dead, 53-year-old man arrested - ABC4.com - March 1st, 2025 [March 1st, 2025]
- An Antarctic mega-iceberg is driftingHow ancient ice history sheds light on its journey - Study Finds - March 1st, 2025 [March 1st, 2025]
- New details: Permitted fire spreads out of control to two sheds, boat and pickup in Falmouth - CapeCod.com News - March 1st, 2025 [March 1st, 2025]
- Karrion Kross sheds his character to speak his mind, delivering a heartfelt message to WWE fans - The Times of India - March 1st, 2025 [March 1st, 2025]
- New research sheds light on disturbing health trends observed around oil and gas wells: 'Important need for additional studies' - The Cool Down - March 1st, 2025 [March 1st, 2025]
- 'The Traitors': Carolyn Wiger Sheds Light On Fiery Roundtable With Danielle Reyes & Where They Stand - Access Hollywood - March 1st, 2025 [March 1st, 2025]