Packaging Corp Of America Ticks Higher; Company Hints Of MLP Conversion
Shares of Packaging Corp of America (NYSE: PKG) popped higher on Tuesday as the company said during a conference call it has hired legal and financial advisers to explore converting itself to a Master Limited Partnership (MLP).
Packaging Corporation announced its third quarter results on Monday after the closing bell. The company earned $1.26 per share, in-line with the consensus estimates while revenue of $1.52 billion came in $20 million more than analysts expected.
Shares were recently up 6.6 percent at $67.29.
The company's move isn't new to the industry. International Paper said in early September it is considering a conversion to an MLP structure.
Analysts at Jefferies predicted in early October that there is a high likelihood that one of the major containerboard producers would create an MLP structure over the next six to 12 months.
Shares of the three major containerboard producers which consists of Packaging Corp, International Paper and Rock-Tenn all traded higher following Packaging Corp's comments.
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