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Karat Packaging Q3 sales miss analyst estimates

By Reuters News


Overview

  • US disposable foodservice products maker's Q3 net sales rose 8% yr/yr but missed analyst expectations

  • Margins declined due to higher product and shipping costs


Outlook

  • Company expects Q4 2026 net sales to rise 9-11% from prior-year quarter

  • Company sees Q4 2026 gross margin between 33-35%

  • Company expects Q4 2026 adjusted EBITDA margin in high-single digits


Result Drivers

  • E-COMMERCE GROWTH - Co said online sales grew nearly 38% yr/yr, driving overall sales increase

  • VOLUME AND PRODUCT MIX - Co attributed sales growth to higher volume and changes in product mix

  • HIGHER COSTS - Co said increased import, shipping and resin costs pressured margins and contributed to results below expectations


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 Sales

Miss

$134.70 mln

$140.33 mln (3 Analysts)

Q3 Net Income

$4.70 mln

Q3 Adjusted EBITDA

Miss

$8.90 mln

$13.93 mln (3 Analysts)


Analyst Coverage

  • The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", no "hold" and 1 "sell" or "strong sell"

  • The average consensus recommendation for the non-paper containers & packaging peer group is "buy"

  • Wall Street's median 12-month price target for Karat Packaging Inc is $46.50, about 13.3% below its November 4 closing price of $53.63

  • The stock recently traded at 23 times the next 12-month earnings vs. a P/E of 20 three months ago


Reuters Recommended Reads

  • Nov 3 - Graphic Packaging Q3 sales, adjusted EPS slightly beat estimates

  • Nov 4 - Reynolds Consumer Q3 revenue rises 1%, slightly beating estimates

  • Nov 3 - Greif Q4 net loss narrowed on higher selling prices


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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