NYSE:GPK

Stock Analysis Report

Graphic Packaging Holding

Executive Summary

Graphic Packaging Holding Company, together with its subsidiaries, provides paper-based packaging solutions to food, beverage, foodservice, and other consumer products companies.

Rewards

Earnings are forecast to grow 10.38% per year

Risk Analysis

Debt is not well covered by operating cash flow

Unstable dividend track record

Profit margins (3.6%) are lower than last year (6.2%)



Snowflake Analysis

Mediocre balance sheet second-rate dividend payer.


Similar Companies

Share Price & News

How has Graphic Packaging Holding's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: GPK has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.8%

GPK

4.0%

US Packaging

2.0%

US Market


1 Year Return

39.3%

GPK

19.4%

US Packaging

23.5%

US Market

Return vs Industry: GPK exceeded the US Packaging industry which returned 18.8% over the past year.

Return vs Market: GPK exceeded the US Market which returned 24.7% over the past year.


Shareholder returns

GPKIndustryMarket
7 Day2.8%4.0%2.0%
30 Day-1.6%2.2%4.3%
90 Day13.1%5.7%12.2%
1 Year42.3%39.3%22.3%19.4%26.1%23.5%
3 Year44.5%35.3%29.6%20.9%53.1%43.2%
5 Year27.8%15.9%47.9%28.9%75.5%56.1%

Price Volatility Vs. Market

How volatile is Graphic Packaging Holding's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Graphic Packaging Holding undervalued compared to its fair value and its price relative to the market?

22.33x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: GPK ($16.78) is trading above our estimate of fair value ($16.65)

Significantly Below Fair Value: GPK is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: GPK is poor value based on its PE Ratio (22.3x) compared to the Packaging industry average (18.8x).

PE vs Market: GPK is poor value based on its PE Ratio (22.3x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: GPK is poor value based on its PEG Ratio (2.1x)


Price to Book Ratio

PB vs Industry: GPK is good value based on its PB Ratio (3.1x) compared to the US Packaging industry average (3.4x).


Next Steps

Future Growth

How is Graphic Packaging Holding forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

10.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: GPK's forecast earnings growth (10.4% per year) is above the savings rate (1.7%).

Earnings vs Market: GPK's earnings (10.4% per year) are forecast to grow slower than the US market (14.3% per year).

High Growth Earnings: GPK's earnings are forecast to grow, but not significantly.

Revenue vs Market: GPK's revenue (2.1% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: GPK's revenue (2.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: GPK's Return on Equity is forecast to be low in 3 years time (15.6%).


Next Steps

Past Performance

How has Graphic Packaging Holding performed over the past 5 years?

12.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: GPK has high quality earnings.

Growing Profit Margin: GPK's current net profit margins (3.6%) are lower than last year (6.2%).


Past Earnings Growth Analysis

Earnings Trend: GPK's earnings have grown by 12.6% per year over the past 5 years.

Accelerating Growth: GPK's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: GPK had negative earnings growth (-36.3%) over the past year, making it difficult to compare to the Packaging industry average (-18.3%).


Return on Equity

High ROE: GPK's Return on Equity (12.9%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Graphic Packaging Holding's financial position?


Financial Position Analysis

Short Term Liabilities: GPK's short term assets ($1.8B) exceed its short term liabilities ($1.1B).

Long Term Liabilities: GPK's short term assets ($1.8B) do not cover its long term liabilities ($3.8B).


Debt to Equity History and Analysis

Debt Level: GPK's debt to equity ratio (123.8%) is considered high.

Reducing Debt: GPK's debt to equity ratio has reduced from 189% to 123.8% over the past 5 years.

Debt Coverage: GPK's debt is not well covered by operating cash flow (8%).

Interest Coverage: GPK's interest payments on its debt are well covered by EBIT (3.9x coverage).


Balance Sheet

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

Debt Coverage by Assets: GPK's debt is not covered by short term assets (assets are 0.6x debt).


Next Steps

Dividend

What is Graphic Packaging Holding's current dividend yield, its reliability and sustainability?

1.81%

Current Dividend Yield


Dividend Yield vs Market

company1.8%marketbottom25%1.4%markettop25%3.7%industryaverage2.5%forecastin3Years2.2%

Current dividend yield vs market & industry

Notable Dividend: GPK's dividend (1.81%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: GPK's dividend (1.81%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, GPK has been paying a dividend for less than 10 years.

Growing Dividend: GPK's dividend payments have increased, but the company has only paid a dividend for 5 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (40.4%), GPK's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: GPK's dividends in 3 years are forecast to be well covered by earnings (27.9% payout ratio).


Next Steps

Management

What is the CEO of Graphic Packaging Holding's salary, the management and board of directors tenure and is there insider trading?

2.5yrs

Average management tenure


CEO

Mike Doss (53yo)

4yrs

Tenure

US$7,264,270

Compensation

Mr. Michael P. Doss, also known as Mike, has been the Chief Executive Officer and President of Graphic Packaging Holding Company since January 1, 2016 and May 20, 2015 respectively. Mr. Doss has been Chief ...


CEO Compensation Analysis

Compensation vs Market: Mike's total compensation ($USD7.26M) is about average for companies of similar size in the US market ($USD6.46M).

Compensation vs Earnings: Mike's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

2.5yrs

Average Tenure

53yo

Average Age

Experienced Management: GPK's management team is considered experienced (2.5 years average tenure).


Board Age and Tenure

4.7yrs

Average Tenure

61yo

Average Age

Experienced Board: GPK's board of directors are considered experienced (4.7 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$183,75028 Feb 19
Robert Hagemann
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares15,000
Max PriceUS$12.25

Ownership Breakdown

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


Management Team

  • Debbie Frank (59yo)

    Senior VP & Chief Accounting Officer

    • Lauren Tashma (53yo)

      Executive VP

      • Tenure: 5.9yrs
      • Compensation: US$1.73m
    • Mike Doss (53yo)

      President

      • Tenure: 4yrs
      • Compensation: US$7.26m
    • Paul McCann

      Senior Vice President of Supply Chain

      • Tenure: 1.4yrs
    • Joe Yost (52yo)

      Executive VP & President of Americas

      • Tenure: 11yrs
      • Compensation: US$2.13m
    • Steve Scherger (55yo)

      Executive VP & CFO

      • Tenure: 5yrs
      • Compensation: US$2.68m
    • Hilde Van Moeseke (49yo)

      Senior VP & President of EMEA

      • Tenure: 2.5yrs
    • Mike Farrell (52yo)

      Executive Vice President of Mills Division

      • Tenure: 2yrs
    • Stacey Panayiotou

      Executive Vice President of Human Resources

      • Tenure: 0.8yrs
    • Melanie Skijus

      Vice President of Investor Relations

      • Tenure: 1yrs

    Board Members

    • Laurie Brlas (61yo)

      Independent Director

      • Tenure: 1yrs
    • Dean Scarborough (64yo)

      Independent Director

      • Tenure: 1.5yrs
      • Compensation: US$38.77k
    • Bob Hagemann (62yo)

      Independent Director

      • Tenure: 5.7yrs
      • Compensation: US$212.52k
    • Phil Martens (59yo)

      Independent Chairman

      • Tenure: 3.7yrs
      • Compensation: US$350.00k
    • David Campbell (69yo)

      Independent Director

      • Tenure: 7.9yrs
      • Compensation: US$200.00k
    • Lynn Wentworth (61yo)

      Independent Director

      • Tenure: 10.2yrs
      • Compensation: US$220.00k
    • Paul Carrico (68yo)

      Independent Director

      • Tenure: 5.3yrs
      • Compensation: US$200.00k
    • Larry Venturelli (59yo)

      Independent Director

      • Tenure: 3.7yrs
      • Compensation: US$200.00k
    • Mike Doss (53yo)

      President

      • Tenure: 4yrs
      • Compensation: US$7.26m

    Company Information

    Graphic Packaging Holding Company's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Graphic Packaging Holding Company
    • Ticker: GPK
    • Exchange: NYSE
    • Founded: 1992
    • Industry: Paper Packaging
    • Sector: Materials
    • Market Cap: US$4.815b
    • Shares outstanding: 290.25m
    • Website: https://www.graphicpkg.com

    Number of Employees


    Location

    • Graphic Packaging Holding Company
    • 1500 Riveredge Parkway
    • Suite 100
    • Atlanta
    • Georgia
    • 30328
    • United States

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    GPKNYSE (New York Stock Exchange)YesCommon StockUSUSDAug 2003
    4W8DB (Deutsche Boerse AG)YesCommon StockDEEURAug 2003

    Biography

    Graphic Packaging Holding Company, together with its subsidiaries, provides paper-based packaging solutions to food, beverage, foodservice, and other consumer products companies. It operates through three segments: Paperboard Mills, Americas Paperboard Packaging, and Europe Paperboard Packaging. The company offers coated unbleached kraft (CUK), coated recycled paperboard (CRB), and solid bleached sulfate paperboard (SBS) to various paperboard packaging converters and brokers; and paperboard packaging folding cartons and cups, lids, and food containers primarily to consumer packaged goods, quick-service restaurants, and foodservice companies. It also manufactures corrugated medium products; offers various laminated, coated, and printed packaging structures that are produced from its CUK, CRB, and SBS, as well as other grades of paperboards that are purchased from third-party suppliers; designs and manufactures specialized packaging machines that package bottles and cans, and non-beverage consumer products; and installs its packaging machines at customer plants and provides support, service, and performance monitoring of the machines. The company markets its products primarily through sales offices and broker arrangements with third parties in the Americas, Europe, and the Asia Pacific. Graphic Packaging Holding Company was founded in 1992 and is headquartered in Atlanta, Georgia. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/17 23:57
    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.