What happened

Shares of fresh food and beverage distributor Pactiv Evergreen (PTVE -0.95%) crashed Thursday, closing the trading session down by 9.8% after the company reported earnings for the fourth quarter and full year.

Pactiv earned $0.10 per share in Q4 2020, versus a $1.03 per share loss in Q4 2019. That sounds pretty good, but according to Bank of America, it was an "earnings miss." BofA analyst George Staphos downgraded the stock to neutral Thursday morning, reported financial news website The Fly -- and so some investors are selling.

White arrow declining sharply atop a stock tickertape display bathed in red

Image source: Getty Images.

So what

That downgrade aside, though, how bad was the quarter, really?  

Sales declined 10% year over year to $1.2 billion -- not great, but probably not surprising, considering that the economy's still stuck in a recession and fighting a pandemic. And viewed in that context, the fact that Pactiv ended the year with no worse than an $0.08 loss from continuing operations is actually pretty impressive -- as is the fact that it earned $0.10 per share in 2020's final quarter.

CEO John McGrath pronounced himself "pleased that our fourth quarter 2020 operating performance ended near the prior year and where we were expecting despite ongoing headwinds from the impacts of COVID-19," and I have to agree.

Now what

That being said, the outlook for next year still doesn't really impress. Pactiv warns of "continued softened demand in its Foodservice and Beverage Merchandising segments" due to COVID-19. The company's also just now recovering from winter storm damage to its southern facilities, and it warns that "the financial impact of this event is still being assessed," as are the effects of the winter weather on its operations elsewhere in the country.

The best Pactiv can say right now is that it "expects a strong second half of 2021 as the vaccine roll-out is forecasted to reach critical mass." That implies perhaps six long months of bad news before any good news can arrive.

Judging from Thursday's share price action, it seems not all investors are interested in waiting that long.