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Graphic Packaging (GPK) Gains As Market Dips: What You Should Know

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Graphic Packaging (GPK - Free Report) closed at $23.50 in the latest trading session, marking a +0.64% move from the prior day. The stock outpaced the S&P 500's daily loss of 1.22%. At the same time, the Dow lost 0.83%, and the tech-heavy Nasdaq lost 1.56%.

Prior to today's trading, shares of the packaging company had gained 6.77% over the past month. This has outpaced the Industrial Products sector's loss of 1.77% and the S&P 500's gain of 0.54% in that time.

Wall Street will be looking for positivity from Graphic Packaging as it approaches its next earnings report date. On that day, Graphic Packaging is projected to report earnings of $0.73 per share, which would represent year-over-year growth of 8.96%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.49 billion, up 1.52% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.84 per share and revenue of $9.8 billion, which would represent changes of +21.89% and +3.83%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for Graphic Packaging. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Graphic Packaging is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that Graphic Packaging has a Forward P/E ratio of 8.21 right now. For comparison, its industry has an average Forward P/E of 12.29, which means Graphic Packaging is trading at a discount to the group.

Also, we should mention that GPK has a PEG ratio of 0.33. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Containers - Paper and Packaging stocks are, on average, holding a PEG ratio of 2.93 based on yesterday's closing prices.

The Containers - Paper and Packaging industry is part of the Industrial Products sector. This group has a Zacks Industry Rank of 113, putting it in the top 45% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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