Reynolds delivered a solid first quarter, with results surpassing Wall Street’s expectations and prompting a positive market reaction. Management attributed the performance to broad-based share gains across most of its portfolio, improved operational efficiency, and double-digit e-commerce growth. CEO Scott Huckins highlighted that, despite facing private label bid losses and heightened promotional activity in categories like waste bags, success in other segments and effective execution helped offset these headwinds. The launch of new products, such as Reynolds countertop prep paper, and distribution wins during spring resets also contributed to the company’s momentum.
Is now the time to buy REYN? Find out in our full research report (it’s free for active Edge members).
Reynolds (REYN) Q1 CY2026 Highlights:
- Revenue: $877 million vs analyst estimates of $822.5 million (7.2% year-on-year growth, 6.6% beat)
- Adjusted EPS: $0.28 vs analyst estimates of $0.24 (14.5% beat)
- Adjusted EBITDA: $131 million vs analyst estimates of $121.6 million (14.9% margin, 7.7% beat)
- Revenue Guidance for Q2 CY2026 is $933.3 million at the midpoint, roughly in line with what analysts were expecting
- Management reiterated its full-year Adjusted EPS guidance of $1.60 at the midpoint
- EBITDA guidance for the full year is $667.5 million at the midpoint, in line with analyst expectations
- Operating Margin: 11.2%, up from 9.3% in the same quarter last year
- Organic Revenue rose 7% year on year (beat)
- Sales Volumes rose 2% year on year (-4% in the same quarter last year)
- Market Capitalization: $4.55 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Reynolds’s Q1 Earnings Call
- Peter Grom (UBS): Asked about the $200 million input cost inflation and how the company plans to offset it. CFO Nathan Lowe explained the headwind is based on settled rates for aluminum and resin, with plans to address it through pricing and productivity initiatives.
- Peter Grom (UBS): Inquired about the impact of rising gasoline prices on consumer behavior and category trends. CEO Scott Huckins emphasized that consumers are adjusting spending by reducing dining out, travel, and entertainment, which may benefit at-home consumption categories.
- Robert Ottenstein (Evercore ISI): Questioned the intense promotional activity in the Waste Bag segment and whether these promotions would abate as input costs rise. Lowe noted that the company expected increased competition and is monitoring conditions to adjust its strategy if needed.
- Robert Ottenstein (Evercore ISI): Sought clarity on whether promotional escalations in April were planned or a reaction to market changes. Lowe suggested that promotional timing could explain the pattern, as many campaigns are scheduled months in advance.
- Shabana Chuadhary (JPMorgan): Asked whether top-line growth in the second half would rely more on pricing than initially expected, given commodity cost inflation. Lowe confirmed that pricing would become a larger contributor, though volume and share performance relative to categories remain key priorities.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will be watching (1) how Reynolds executes pricing actions to recover commodity cost inflation, (2) the company’s ability to sustain market share gains amid heightened promotional activity, and (3) whether new product launches and segment realignment yield incremental growth. Ongoing trends in consumer spending and raw material pricing will also be critical factors in tracking Reynolds’ execution.
Reynolds currently trades at $21.72, up from $21.29 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free).
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