Graphic Packaging Holding Company (GPK - Free Report) announced yesterday that it will acquire a part of Memphis, TN-based International Paper Company’s (IP) minority interest in Graphic Packaging International Partners, LLC (“GPIP”). The transaction has been valued at $250 million.
Based in Delaware, GPIP — a limited liability company — is a subsidiary of Graphic Packaging.
It is worth noting here that Graphic Packaging’s share price increased 1.9% yesterday, closing the trading session at $14.71.
Inside the Headlines
As noted, Graphic Packaging will purchase 17.4 million partnership units of GPIP from International Paper. This $250-million stake acquisition will enhance Graphic Packaging’s interest in the above-mentioned limited liability company by 4.4 percentage points to 85.5%.
Notably, Graphic Packaging intends on financing the stake buyout with funds raised from revolving credit facility and available cash.
In January 2020, the company carried out a similar transaction, wherein it purchased 15.1 million partnership units of GPIP from International Paper. The transaction was worth $250 million and increased Graphic Packaging’s stake in GPIP by 3.3 percentage points.
Graphic Packaging’s Inorganic Initiatives
The company believes in acquiring businesses to improve its product lines and market exposure.
In April 2020, Graphic Packaging, through Graphic Packaging International, LLC, acquired Greif, Inc’s (GEF - Free Report) Consumer Packaging Group business for $85 million. Also, Graphic Packaging acquired Quad/Graphics, Inc.’s (QUAD - Free Report) folding carton facility in January 2020. The transaction value was $40 million.
Zacks Rank, Estimate Trend and Price Performance
With a market capitalization of $4.1 billion, Graphic Packaging currently sports a Zacks Rank #1 (Strong Buy).
In the past three months, the company’s shares have gained 13.5% compared with the industry’s growth of 19.2%.
Meanwhile, the Zacks Consensus Estimate for its earnings has been raised by 9.4% to $1.05 for 2020 and by 7.8% to $1.11 for 2021 in the past 60 days. On a year-over-year basis, estimates suggest growth of 20.7% for 2020 and 6% for 2021.
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It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
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Graphic Packaging Holding Company (GPK - Free Report) announced yesterday that it will acquire a part of Memphis, TN-based International Paper Company’s (IP) minority interest in Graphic Packaging International Partners, LLC (“GPIP”). The transaction has been valued at $250 million.
Based in Delaware, GPIP — a limited liability company — is a subsidiary of Graphic Packaging.
It is worth noting here that Graphic Packaging’s share price increased 1.9% yesterday, closing the trading session at $14.71.
Inside the Headlines
As noted, Graphic Packaging will purchase 17.4 million partnership units of GPIP from International Paper. This $250-million stake acquisition will enhance Graphic Packaging’s interest in the above-mentioned limited liability company by 4.4 percentage points to 85.5%.
Notably, Graphic Packaging intends on financing the stake buyout with funds raised from revolving credit facility and available cash.
In January 2020, the company carried out a similar transaction, wherein it purchased 15.1 million partnership units of GPIP from International Paper. The transaction was worth $250 million and increased Graphic Packaging’s stake in GPIP by 3.3 percentage points.
Graphic Packaging’s Inorganic Initiatives
The company believes in acquiring businesses to improve its product lines and market exposure.
In April 2020, Graphic Packaging, through Graphic Packaging International, LLC, acquired Greif, Inc’s (GEF - Free Report) Consumer Packaging Group business for $85 million. Also, Graphic Packaging acquired Quad/Graphics, Inc.’s (QUAD - Free Report) folding carton facility in January 2020. The transaction value was $40 million.
Zacks Rank, Estimate Trend and Price Performance
With a market capitalization of $4.1 billion, Graphic Packaging currently sports a Zacks Rank #1 (Strong Buy).
In the past three months, the company’s shares have gained 13.5% compared with the industry’s growth of 19.2%.
Meanwhile, the Zacks Consensus Estimate for its earnings has been raised by 9.4% to $1.05 for 2020 and by 7.8% to $1.11 for 2021 in the past 60 days. On a year-over-year basis, estimates suggest growth of 20.7% for 2020 and 6% for 2021.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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