NYSE:QUAD

Stock Analysis Report

Executive Summary

Quad/Graphics, Inc. provides marketing solutions worldwide.

Rewards

Trading at 75.5% below its fair value

Risk Analysis

Currently unprofitable and not forecast to become profitable over the next 3 years

Dividend of 12.68% is not well covered by earnings

Highly volatile share price over past 3 months



Snowflake Analysis

Fair value with mediocre balance sheet.


Similar Companies

Share Price & News

How has Quad/Graphics's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: QUAD's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

3.0%

QUAD

2.6%

US Commercial Services

2.0%

US Market


1 Year Return

-64.9%

QUAD

22.9%

US Commercial Services

23.6%

US Market

Return vs Industry: QUAD underperformed the US Commercial Services industry which returned 23.7% over the past year.

Return vs Market: QUAD underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

QUADIndustryMarket
7 Day3.0%2.6%2.0%
30 Day12.5%4.3%3.9%
90 Day-53.4%4.8%12.0%
1 Year-60.7%-64.9%27.5%22.9%26.2%23.6%
3 Year-76.6%-81.4%66.5%55.6%53.2%43.3%
5 Year-65.8%-76.3%108.1%86.9%75.7%56.3%

Price Volatility Vs. Market

How volatile is Quad/Graphics's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Quad/Graphics undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: QUAD ($4.73) is trading below our estimate of fair value ($19.27)

Significantly Below Fair Value: QUAD is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: QUAD is unprofitable, so we can't compare its PE Ratio to the Commercial Services industry average.

PE vs Market: QUAD is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate QUAD's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: QUAD is good value based on its PB Ratio (1.1x) compared to the US Commercial Services industry average (2.1x).


Next Steps

Future Growth

How is Quad/Graphics forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

-13.0%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if QUAD's forecast earnings growth is above the savings rate (1.7%).

Earnings vs Market: Insufficient data to determine if QUAD's earnings are forecast to grow faster than the US market

High Growth Earnings: Insufficient data to determine if earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: QUAD's revenue is expected to decline over the next 3 years (-13% per year).

High Growth Revenue: QUAD's revenue is forecast to decline over the next 3 years (-13% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if QUAD's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Quad/Graphics performed over the past 5 years?

37.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: QUAD is currently unprofitable.

Growing Profit Margin: QUAD is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: QUAD is unprofitable, but has reduced losses over the past 5 years at a rate of 37% per year.

Accelerating Growth: Unable to compare QUAD's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: QUAD is unprofitable, making it difficult to compare its past year earnings growth to the Commercial Services industry (-1.3%).


Return on Equity

High ROE: QUAD has a negative Return on Equity (-39.83%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Quad/Graphics's financial position?


Financial Position Analysis

Short Term Liabilities: QUAD's short term assets ($865.0M) exceed its short term liabilities ($818.9M).

Long Term Liabilities: QUAD's short term assets ($865.0M) do not cover its long term liabilities ($1.4B).


Debt to Equity History and Analysis

Debt Level: QUAD's debt to equity ratio (483.4%) is considered high.

Reducing Debt: QUAD's debt to equity ratio has increased from 132.3% to 483.4% over the past 5 years.


Balance Sheet

Inventory Level: QUAD has a high level of physical assets or inventory.

Debt Coverage by Assets: QUAD's debt is not covered by short term assets (assets are 0.7x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable QUAD has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: QUAD is unprofitable but has sufficient cash runway for more than 3 years, even with free cash flow being positive and shrinking by -33.3% per year.


Next Steps

Dividend

What is Quad/Graphics's current dividend yield, its reliability and sustainability?

12.32%

Current Dividend Yield


Dividend Yield vs Market

company12.3%marketbottom25%1.4%markettop25%3.7%industryaverage1.5%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: QUAD's dividend (12.68%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: QUAD's dividend (12.68%) is in the top 25% of dividend payers in the US market (3.66%)


Stability and Growth of Payments

Stable Dividend: QUAD has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: QUAD's dividend payments have increased, but the company has only paid a dividend for 9 years.


Current Payout to Shareholders

Dividend Coverage: QUAD is paying a dividend but the company is unprofitable.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

What is the CEO of Quad/Graphics's salary, the management and board of directors tenure and is there insider trading?

4.6yrs

Average management tenure


CEO

J. Quadracci (50yo)

13.5yrs

Tenure

US$6,459,795

Compensation

Mr. J. Joel Quadracci serves as President of Quad/Greenfield, LLC and Graphic Imaging Technology, LLC. Mr. Quadracci has been the Chairman, Chief Executive Officer and President of Quad/Graphics, Inc. sinc ...


CEO Compensation Analysis

Compensation vs Market: J.'s total compensation ($USD6.46M) is above average for companies of similar size in the US market ($USD1.08M).

Compensation vs Earnings: J.'s compensation has increased whilst the company is unprofitable.


Management Age and Tenure

4.6yrs

Average Tenure

51.5yo

Average Age

Experienced Management: QUAD's management team is considered experienced (4.6 years average tenure).


Board Age and Tenure

6.1yrs

Average Tenure

60yo

Average Age

Experienced Board: QUAD's board of directors are considered experienced (6.1 years average tenure).


Insider Trading

Insider Buying: QUAD insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$47,26227 Nov 19
Thomas Frankowski
EntityIndividual
Role
Chief Operating Officer
Executive VP of Manufacturing & COO
Shares11,000
Max PriceUS$4.30
BuyUS$84,51912 Nov 19
Kelly Vanderboom
EntityIndividual
Shares20,000
Max PriceUS$4.25
BuyUS$18,00508 Nov 19
Christopher Harned
EntityIndividual
Role
Member of the Board of Directors
Director
Shares4,350
Max PriceUS$4.14
BuyUS$45,83006 Nov 19
David Honan
EntityIndividual
Role
Chief Financial Officer
Executive VP & CFO
Shares10,000
Max PriceUS$4.58
BuyUS$45,65106 Nov 19
Jennifer Kent
EntityIndividual
Role
Chief Administrative Officer
Executive VP of Administration
Shares10,000
Max PriceUS$4.57
SellUS$53,08312 Aug 19
Kathryn Flores
EntityIndividual
Role
Member of the Board of Directors
Director
Shares4,974
Max PriceUS$10.67
SellUS$111,92406 Aug 19
John Fowler
EntityIndividual
Role
Member of the Board of Directors
Director
Shares10,000
Max PriceUS$11.53
SellUS$197,06308 Mar 19
Eric Ashworth
EntityIndividual
Role
Senior Key Executive
Executive Vice President of Product & Market Strategy
Shares15,000
Max PriceUS$13.14

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Tom Frankowski (58yo)

    Executive VP of Manufacturing & COO

    • Tenure: 5.8yrs
    • Compensation: US$2.92m
  • J. Quadracci (50yo)

    Chairman

    • Tenure: 13.5yrs
    • Compensation: US$6.46m
  • Renee Badura (55yo)

    Executive Vice President of Sales & Marketing

    • Tenure: 4.6yrs
  • Steve Jaeger (54yo)

    Chief Information Officer

    • Tenure: 5.8yrs
    • Compensation: US$1.20m
  • Dave Honan (50yo)

    Executive VP & CFO

    • Tenure: 5.8yrs
    • Compensation: US$2.01m
  • Eric Ashworth (53yo)

    Executive Vice President of Product & Market Strategy

    • Tenure: 3.8yrs
    • Compensation: US$1.53m
  • Maura Packham (50yo)

    Vice President of Corporate Communications

    • Tenure: 3.1yrs
  • Jennifer Kent (47yo)

    Executive VP of Administration

    • Tenure: 4.6yrs
    • Compensation: US$1.69m
  • Dana Gruen

    Chief Compliance Officer

    • Tenure: 3.1yrs
  • Kyle Egan

    Director of Investor Relations & Assistant Treasurer


    Board Members

    • John Fowler (68yo)

      Director

      • Tenure: 3.5yrs
      • Compensation: US$252.18k
    • John Shiely (66yo)

      Independent Director

      • Tenure: 24yrs
      • Compensation: US$248.69k
    • Mark Angelson (67yo)

      Independent Director

      • Tenure: 4.8yrs
      • Compensation: US$233.69k
    • Douglas Buth (64yo)

      Independent Director

      • Tenure: 15yrs
      • Compensation: US$253.69k
    • Jay Rothman (60yo)

      Independent Director

      • Tenure: 2.7yrs
      • Compensation: US$223.69k
    • Chris Harned (56yo)

      Director

      • Tenure: 15yrs
      • Compensation: US$243.69k
    • J. Quadracci (50yo)

      Chairman

      • Tenure: 13.5yrs
      • Compensation: US$6.46m
    • Kathryn Flores (51yo)

      Director

      • Tenure: 6.1yrs
      • Compensation: US$233.69k
    • Steve Fuller (58yo)

      Director

      • Tenure: 4yrs
      • Compensation: US$233.69k

    Company Information

    Quad/Graphics, Inc.'s company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Quad/Graphics, Inc.
    • Ticker: QUAD
    • Exchange: NYSE
    • Founded: 1971
    • Industry: Commercial Printing
    • Sector: Commercial Services
    • Market Cap: US$257.119m
    • Shares outstanding: 52.80m
    • Website: https://www.quad.com

    Number of Employees


    Location

    • Quad/Graphics, Inc.
    • N61 W23044 Harry’s Way
    • Sussex
    • Wisconsin
    • 53089
    • United States

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    QUADNYSE (New York Stock Exchange)YesClass A Common StockUSUSDJul 2010
    QGUDB (Deutsche Boerse AG)YesClass A Common StockDEEURJul 2010

    Biography

    Quad/Graphics, Inc. provides marketing solutions worldwide. The company operates through United States Print and Related Services, and International segments. It offers printing services, such as retail inserts, publications, catalogs, special interest publications, journals, direct mail, books, directories, in-store marketing and promotion, packaging, newspapers, custom print products, and other commercial and specialty printed products; and paper procurement services. The company also provides marketing and other services, including consumer insights, audience targeting, personalization, media planning and placement, process optimization, campaign planning and creation, pre-media production, videography, photography, digital and print execution, and logistics, as well as manufactures ink. It serves various blue chip companies that operate in various industries; and businesses and consumers comprising retailers, publishers, and direct marketers. Quad/Graphics, Inc. has a strategic partnership with the dtx company. The company was founded in 1971 and is headquartered in Sussex, Wisconsin. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/19 00:14
    End of Day Share Price2020/01/17 00:00
    Earnings2019/09/30
    Annual Earnings2018/12/31


    Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.