Despite the current macroeconomic challenges, the industrial packaging industry is well-positioned for growth thanks to growing industrial and manufacturing activities, rising demand for sustainable packaging, and the requirement for durable packaging to safeguard products during shipping. The rising demand for reliable packaging solutions will drive the industrial packaging industry’s growth.
Amid this backdrop, it could be wise to buy fundamentally strong industrial stocks Smurfit Kappa Group Plc (SMFKY – Get Rating), Veritiv Corporation (VRTV – Get Rating), and Karat Packaging Inc. (KRT – Get Rating).
Before diving deeper into the fundamentals of these stocks, let’s discuss why the industrial packaging industry is likely to grow.
The industrial packaging industry faced the challenges of high inflation, rising labor and raw material costs, declining consumer spending, and supply chain challenges over the past year. However, with inflation easing and job growth remaining strong, consumer spending is expected to remain stable in the near term.
Stability in consumer spending bodes well for the packaging industry. As global trade continues to flourish along with the rapid growth in e-commerce, the demand for the industrial packaging industry is expected to remain robust.
In addition, there has been an increasing demand for packaged food driven by modern lifestyles and changing eating habits. Packaged food offers extended shelf life and enhanced safety.
Moreover, with strict government regulations limiting the use of plastic, the industrial packaging industry is developing innovative sustainable packaging solutions. This is expected to boost the growth prospects of the industry.
The industrial packaging market is estimated to grow at a CAGR of 5% to reach $80.88 billion in 2028.
Let’s take a closer look at the fundamentals of the featured stocks…
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