Karat Packaging Q4 sales beat estimates
Overview
US disposable foodservice supplier's Q4 net sales rose 13.7%, beating analyst expectations
Q4 adjusted EBITDA beat analyst expectations; gross margin fell due to higher tariffs
Company repurchased $3 mln in shares during Q4
Outlook
Karat expects Q1 2026 net sales to rise 8-10% from prior-year qtr
Company sees Q1 2026 gross margin between 34% and 36%
Karat expects margin tailwinds in Q2 2026 from tariff and currency stabilization
Result Drivers
VOLUME AND PRICING - Double-digit volume growth and a positive pricing shift drove Q4 net sales higher, per CEO Alan Yu
TARIFFS PRESSURE - Higher tariffs and duty costs reduced gross margin, partially offset by more favorable vendor pricing and lower logistics expense
Company press release: ID:nGNX89qqlQ
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q4 Sales | Beat | $115.60 mln | $113.95 mln (3 Analysts) |
Q4 Adjusted EPS | Beat | $0.34 | $0.28 (2 Analysts) |
Q4 Net Income |
| $7.2 mln |
|
Q4 Adjusted EBITDA | Beat | $12.5 mln | $10.40 mln (3 Analysts) |
Q4 Gross Margin |
| 34.00% |
|
Analyst Coverage
The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 1 "strong buy" or "buy", 1 "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 $28.50, about 24.9% above its March 11 closing price of $22.82
The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 13 three months ago
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