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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Graphic Packaging Holding Company (XNYS:GPK) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
GPK
Name:
GRAPHIC PACKAGING HOLDING COMPANY (XNYS:GPK)
Sector:
- 205000.00K
Industry:
Packaging & Containers
CEO:
Mr. Michael Doss
Total Employees:
25,000
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is 0.95% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF GRAPHIC PACKAGING HOLDING COMPANY(GPK) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND PACKAGING & CONTAINERS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
22.4
One Month Price Target:
$22.52
Six Month Price Target :
$23.11
Likely Price in One Year's Time:
Ticker:
$23.82
Likely Trading Range Today Under (Normal Volatility)
$22.34
Price Upper limit ($) :
$22.49
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$21.48
This week:
$20.35
This month :
$18.31
Other Primary facts
Market Cap:
6.95B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
307.83M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
11.26%
-11.82%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$26.64
$24.68
$18.16
$20.12
Medium risk (<10%) entry points
Buy Call
Sell Call
$24.04
Buy Put:
Sell Put:
$23.63
$20.75
$21.17
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
GPK
Sharpe Ratio:
2.69%
Comparison:
GPK, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 72.17% higher than the industry
& ratio is 18.22% higher than the market/S&P 500 average
Average Returns/Yield of
GPK
Daily returns:
0.06%
Weekly returns:
0.32%
Monthly returns:
1.27%
Yearly returns:
11.46%
Comparison of returns:
Average annual returns/yield (last 3 years) is 32.58% above industry average
Classification:
GPK, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.7
Statistical test of Returns:
GPK has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.02%
Weekly Volatility:
4.52%
Monthly Volatility:
9.03%
Yearly Volatility:
31.29%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.04%
Volatility in last five trading days has been -48.41% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.09%
Weekly VaR:
-9.14%
Monthly VaR:
-18.27%
How Much Can the price of
GPK
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-15%
Worst case (decline):
-63.29%
This translates to price declining to:
$18.94
This translates to price declining to:
$8.22
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
GPK is a 28.95% riskier investment compared to the market/S&P 500 & is 10.47% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -15.35% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
GPK
Beta in relation to market/S&P 500--0.94
Expected beta in 1 year's time:
0.666
Expected beta in 3 year's time:
0.942
Unlevered (debt free) Beta:
0.307
Beta in relation to Nasdaq (XNAS):
0.589
Beta in relation to all global stocks::
0.64
Beta Comparison & Analysis
Beta of competitors/peers::
1.373
Beta is -31.22% lower than peers
Average Industry Beta:
1.004
Beta is -5.92% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
7.56%
Sustainable growth rate is -79.87% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.056
Alpha is 289.27% above industry average alpha yield
Alpha is 355% higher than market/& is unsustainably high
Analysis of Cost of Capital of
GPK
Equity cost of capital:
0.096
Equity cost of capital is -4.06% below industry mean WACC
Unlevered (without debt) cost of capital:
3.12%
Before-tax cost of debt:
2.28%
After-tax cost of debt:
1.80%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.80%
WACC is -21.53% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$25.18
Revenue growth rate per share of (3Y):
3.53
Annual revenue growth rate is 90.34% above the industry average
EPS:
$0.84
Expected Annual growth rate of EPS (3Y):
-0.96%
Expected future EPS growth rate is -110.44% lower than the Packaging & Containers industry
Free cash flow (FCF) per share:
-
Balance sheet equity growth per share: -16.79%
Equity growth rate per share is -241.54% lower than the industry
Debt per share
$18.34
EBITDA per share
$3.26
Valuation Analysis Today of
GPK
P/E Ratio:
24.33
P/E Ratio of Competitors/Peers:
13.7
P/E ratio is 77.64% higher than main peers & is 23.73% higher than the industry
Stock price/value with industry average P/E ratio: $16.52
GPK is 35.61% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $13.70
Present value of the expected future dividends only: $3.12
P/S (Price to Sales ratio):
0.89
Price to sales ratio is -28.62% below the industry mean
P/B (Price to book value ratio):
3.53
-
Price to free cash flow ratio is -91.06% lower than the industry
Net income growth rate (3Y):
-7.37%
Net income growth rate is -72.95% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 8.95%
Dividend yeild: 1.34%
Previous Dividend: $0.08
Previous adjusted dividend: $0.08
Previous Dividend: $0.30
-
-
Average dividend payment (long-term): $0.08
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 10/03/2022
Expected next dividend record date: 13/09/2022
-
Previous dividend payment date: 07/05/2022
Previous dividend record date: 15/06/2022
-
Dividend History:
2022-06-14--$0.08
2021-12-14--$0.08
2021-06-14--$0.08
2022-03-14--$0.08
2021-09-14--$0.08
2021-03-12--$0.08
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
289.64%
Net debt to equity ratio:
298.61%
Debt to assets ratio:
53.54%
Net debt to assets ratio:
55.20%
Debt-to-asset ratio is -19.92% below industry average
Ability to repay debt:
Interest coverage ratio:
7.44
Interest coverage ratio is 32.47% more than industry average
Looking forward:
Debt growth rate:
56.92%
Annual debt growth is -783% lower than industry average debt growth rate
Debt repayment rate in last quarter: 24.33%
Analysis of Key Statistics
Correlation of price movement with the market:
0.66
Statistical significance of correlation:
GPK has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.556
Stock price is 18.73% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.556
Correlation of price movement with Nasdaq (^IXIC):
0.046
Covariance of price movement with the market:
0.053
Kurtosis
4.897
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.186
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
GPK
Gross Profit Margin Ratio:
62%
Operating Profit Margin Ratio:
6.35%
Operating profit margin is -3.64% lower than the industry
Net Profit Margin Ratio:
62%
Effective Tax Rate:
28.18%
Effective tax rate is -21.96% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
13.19%
Return on equity (ROE) is -73.82% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
2.44%
Return on assets (ROA) is -53.12% lower than the industry
Financial Leverage:
2.2x
Current Ratio:
1.37
Current ratio is -13.22% below industry average
Cash Conversion Cycle (days):
-3.2
Cash conversion cycle is -104.96% below industry average
The remaining useful life of property plant & equipment is: 6.2 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
310.1K
Each employee generates -90% less revenue than industry average revenue per employee
EBITDA generated per employee:
40.2K
Each employee generates -93% less EBITDA than industry average revenue per employee
Profit generated per employee:
10.3K
Each employee generates -96% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 8.2K
Each employee generates -50% less free cash flow than industry average revenue per employee
Assets/Capital per employee
315.4K
Each employee generates -50% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
GPK
VIPSHOP HOLDINGS LIMITED (XNYS:VIPS)
HARLEY-DAVIDSON, INC. (XNYS:HOG)
INTERNATIONAL GAME TECHNOLOGY PLC (XNYS:IGT)
HANESBRANDS INC. (XNYS:HBI)
ARAD LTD. (XTAE:ARD)
SONOCO PRODUCTS COMPANY (XNYS:SON)
YETI HOLDINGS, INC. (XNYS:YETI)
HILTON GRAND VACATIONS INC. (XNYS:HGV)
LEGGETT & PLATT, INCORPORATED (XNYS:LEG)
Current Analyst Ratings
Strong buy�17%
Buy�21%
Hold�17%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
7.75B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
6.54B
1.21B
-
-
583.00M
-
- 7000.00K
576.00M
-
135.00M
511.00M
1.01B
492.00M
257.00M
362.00M
102.00M
257.00M
Statement of Cash Flow
Date:
Period:
139.00M
Differed Income Tax :
17.00M
Stock Based Compensation :
-
Change in Working Capital :
- 240000.00K
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
- 5000.00K
Net Cash Provided by Operating Activities:
18.00M
Investments in PP&E:
- 2000.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
111.00M
-
111.00M
945.00M
1.50B
97.00M
2.66B
4.68B
2.01B
831.00M
-
-
374.00M
7.89B
-
10.54B
1.03B
286.00M
-
-
632.00M
1.95B
5.65B
403.00M
6.65B
-
8.59B
3.00M
150.00M
- 242000.0K
2.04B
March 31, 2022 at 6:00:00 AM
7.12B
1.95B
10.54B
-
5.93B
5.8B
-
- 193000.00K
- 195000.00K
- 1815000.00K
-
-
- 23000.00K
1.96B
119.00M
- 3000.00K
- 61000.00K
111.00M
172.00M
18.00M
- 223000.00K
- 205000.00K
Our Proprietary Portfolio Rating
Our Rating:
B
Price Forecast/Expected Price in Next 5 Years of
GPK
2023
2024
2025
2026
2027
$22.80
$24.24
$25.78
$27.42
$29.16