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Greif (GEF) Up 7.1% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Greif (GEF - Free Report) . Shares have added about 7.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Greif due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Greif reported adjusted earnings per share of $1.27 for first-quarter fiscal 2024, beating the Zacks Consensus Estimate of 20 cents. The bottom line increased 20% year over year.
Including one-time items, EPS was $1.75 in the quarter compared with $2.31 in the prior-year quarter.
Operational Update
Sales moved down 5.1% year over year to $1.20 billion due to lower volumes and average selling prices. However, the top line beat the Zacks Consensus Estimate of $1.19 billion.
The cost of sales declined 3.5% year over year to $984 million. Gross profit amounted to $222 million, down 11.9% from the prior-year quarter. The gross margin came in at 18.4%, down from last year’s 19.8%.
Selling, general and administrative expenses were $146 million compared with the prior-year quarter’s $139 million. Adjusted EBITDA declined 22.2% year over year to $128 million in the fiscal first quarter.
Segment Performances
Sales in the Global Industrial Packaging segment were $687 million, lower than the prior-year quarter’s $706 million on declining volumes and average selling prices. Our model projected revenues of $645 million for the quarter. The segment’s adjusted EBITDA amounted to $71 million compared with the year-ago quarter’s $72 million. The reported figure beat our estimate of $46 million. 2
The Paper Packaging segment’s sales fell 8.1% year over year to $515 million in the fiscal first quarter due to a decline in volumes and lower selling prices. The figure missed our estimated sales of $550 million. The segment’s adjusted EBITDA moved down to $55.5 million from the prior-year quarter’s $91 million. We projected the segment’s adjusted EBITDA to be $43 million.
The Land Management segment’s sales totaled $4.6 million in the reported quarter compared with $5 million in the year-ago quarter. We projected the segment's sales to be $4.8 million in the quarter. Adjusted EBITDA was $1.6 million compared with the year-earlier quarter’s $2 million. Our projection for the quarter’s adjusted EBITDA was $1 million.
Financial Position
Greif reported cash and cash equivalents of $179 million at the end of first-quarter fiscal 2024 compared with $181 million at the end of fiscal 2023. Cash flow from operating activities totaled $4.5 million in the quarter under review compared with $33 million in the prior year quarter.
Long-term debt amounted to $2.18 billion as of Jan 31, 2024, compared with $2.12 billion as of Oct 31, 2023.
On Feb 6, Greif’s board announced a quarterly cash dividend of 52 cents per share of Class A Common Stock and 78 cents per share of Class B Common Stock. The dividend will be paid out on Apr 1, 2024, to shareholders of record at the close of the business as of Mar 18, 2022.
Outlook
Greif expects the low end of fiscal 2024 adjusted free cash flow to be $200 million. The low end of adjusted EBITDA is anticipated to be $610 million, up from the prior announced $585 million.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -29.03% due to these changes.
VGM Scores
At this time, Greif has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Greif has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Greif belongs to the Zacks Containers - Paper and Packaging industry. Another stock from the same industry, Sealed Air (SEE - Free Report) , has gained 6.7% over the past month. More than a month has passed since the company reported results for the quarter ended December 2023.
Sealed Air reported revenues of $1.38 billion in the last reported quarter, representing a year-over-year change of -2%. EPS of $0.88 for the same period compares with $0.99 a year ago.
Sealed Air is expected to post earnings of $0.54 per share for the current quarter, representing a year-over-year change of -27%. Over the last 30 days, the Zacks Consensus Estimate has changed -10.7%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #4 (Sell) for Sealed Air. Also, the stock has a VGM Score of B.
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Greif (GEF) Up 7.1% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Greif (GEF - Free Report) . Shares have added about 7.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Greif due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Greif Q1 Earnings Beat Estimates, Sales Decline Y/Y
Greif reported adjusted earnings per share of $1.27 for first-quarter fiscal 2024, beating the Zacks Consensus Estimate of 20 cents. The bottom line increased 20% year over year.
Including one-time items, EPS was $1.75 in the quarter compared with $2.31 in the prior-year quarter.
Operational Update
Sales moved down 5.1% year over year to $1.20 billion due to lower volumes and average selling prices. However, the top line beat the Zacks Consensus Estimate of $1.19 billion.
The cost of sales declined 3.5% year over year to $984 million. Gross profit amounted to $222 million, down 11.9% from the prior-year quarter. The gross margin came in at 18.4%, down from last year’s 19.8%.
Selling, general and administrative expenses were $146 million compared with the prior-year quarter’s $139 million. Adjusted EBITDA declined 22.2% year over year to $128 million in the fiscal first quarter.
Segment Performances
Sales in the Global Industrial Packaging segment were $687 million, lower than the prior-year quarter’s $706 million on declining volumes and average selling prices. Our model projected revenues of $645 million for the quarter. The segment’s adjusted EBITDA amounted to $71 million compared with the year-ago quarter’s $72 million. The reported figure beat our estimate of $46 million.
2
The Paper Packaging segment’s sales fell 8.1% year over year to $515 million in the fiscal first quarter due to a decline in volumes and lower selling prices. The figure missed our estimated sales of $550 million. The segment’s adjusted EBITDA moved down to $55.5 million from the prior-year quarter’s $91 million. We projected the segment’s adjusted EBITDA to be $43 million.
The Land Management segment’s sales totaled $4.6 million in the reported quarter compared with $5 million in the year-ago quarter. We projected the segment's sales to be $4.8 million in the quarter. Adjusted EBITDA was $1.6 million compared with the year-earlier quarter’s $2 million. Our projection for the quarter’s adjusted EBITDA was $1 million.
Financial Position
Greif reported cash and cash equivalents of $179 million at the end of first-quarter fiscal 2024 compared with $181 million at the end of fiscal 2023. Cash flow from operating activities totaled $4.5 million in the quarter under review compared with $33 million in the prior year quarter.
Long-term debt amounted to $2.18 billion as of Jan 31, 2024, compared with $2.12 billion as of Oct 31, 2023.
On Feb 6, Greif’s board announced a quarterly cash dividend of 52 cents per share of Class A Common Stock and 78 cents per share of Class B Common Stock. The dividend will be paid out on Apr 1, 2024, to shareholders of record at the close of the business as of Mar 18, 2022.
Outlook
Greif expects the low end of fiscal 2024 adjusted free cash flow to be $200 million. The low end of adjusted EBITDA is anticipated to be $610 million, up from the prior announced $585 million.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -29.03% due to these changes.
VGM Scores
At this time, Greif has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Greif has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Greif belongs to the Zacks Containers - Paper and Packaging industry. Another stock from the same industry, Sealed Air (SEE - Free Report) , has gained 6.7% over the past month. More than a month has passed since the company reported results for the quarter ended December 2023.
Sealed Air reported revenues of $1.38 billion in the last reported quarter, representing a year-over-year change of -2%. EPS of $0.88 for the same period compares with $0.99 a year ago.
Sealed Air is expected to post earnings of $0.54 per share for the current quarter, representing a year-over-year change of -27%. Over the last 30 days, the Zacks Consensus Estimate has changed -10.7%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #4 (Sell) for Sealed Air. Also, the stock has a VGM Score of B.