Greif (NYSE:GEF) vs. Graphic Packaging (NYSE:GPK) Financial Analysis

Graphic Packaging (NYSE:GPK) and Greif (NYSE:GEF) are both mid-cap industrials companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, dividends, analyst recommendations, risk, profitability and earnings.

Analyst Recommendations

This is a summary of recent ratings and target prices for Graphic Packaging and Greif, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Graphic Packaging	0	9	1	0	2.10
Greif	1	4	2	0	2.14

Graphic Packaging presently has a consensus target price of $23.00, suggesting a potential upside of 32.31%. Greif has a consensus target price of $74.00, suggesting a potential upside of 24.68%. Given Graphic Packaging’s higher probable upside, equities research analysts clearly believe Graphic Packaging is more favorable than Greif.

Profitability

This table compares Graphic Packaging and Greif’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Graphic Packaging	6.18%	21.13%	5.74%
Greif	3.52%	10.09%	3.25%

Dividends

Graphic Packaging pays an annual dividend of $0.44 per share and has a dividend yield of 2.5%. Greif pays an annual dividend of $2.24 per share and has a dividend yield of 3.8%. Graphic Packaging pays out 24.9% of its earnings in the form of a dividend. Greif pays out 71.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Graphic Packaging has raised its dividend for 1 consecutive years and Greif has raised its dividend for 4 consecutive years. Greif is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

Graphic Packaging has a beta of 0.74, meaning that its share price is 26% less volatile than the S&P 500. Comparatively, Greif has a beta of 1, meaning that its share price has a similar volatility profile to the S&P 500.

Earnings & Valuation

This table compares Graphic Packaging and Greif”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Graphic Packaging	$8.81 billion	0.58	$658.00 million	$1.77	9.82
Greif	$5.45 billion	0.52	$268.80 million	$3.15	18.84

Graphic Packaging has higher revenue and earnings than Greif. Graphic Packaging is trading at a lower price-to-earnings ratio than Greif, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

99.7% of Graphic Packaging shares are held by institutional investors. Comparatively, 45.7% of Greif shares are held by institutional investors. 1.4% of Graphic Packaging shares are held by insiders. Comparatively, 7.6% of Greif shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Graphic Packaging beats Greif on 9 of the 17 factors compared between the two stocks.

About Graphic Packaging

Graphic Packaging Holding Company, together with its subsidiaries, designs, produces, and sells consumer packaging products to brands in food, beverage, foodservice, household, and other consumer products. It operates through three segments: Paperboard Manufacturing, Americas Paperboard Packaging, and Europe Paperboard Packaging. The company offers unbleached, bleached, and recycled paperboard to various paperboard packaging converters and brokers. It also provides paperboard packaging products for consumer packaged goods companies; and cups, lids, and food containers for foodservice companies and quick-service restaurants serving the food, beverage, and consumer product markets, including healthcare and beauty. The company also designs, manufactures, and installs specialized packaging machines. The company sells its products through sales offices, as well as through broker arrangements with third parties in the Americas, Europe, and the Asia Pacific. Graphic Packaging Holding Company was incorporated in 2007 and is headquartered in Atlanta, Georgia.

About Greif

Greif, Inc. engages in the production and sale of industrial packaging products and services worldwide. The company operates through Global Industrial Packaging; Paper Packaging & Services; and Land Management segments. The Global Industrial Packaging segment produces and sells industrial packaging products, including steel, fiber, and plastic drums; rigid and flexible intermediate bulk containers; closure systems for industrial packaging products; transit protection products; water bottles, and remanufactured and reconditioned industrial containers; and various services, such as container life cycle management, filling, logistics, warehousing, and other packaging services to chemicals, paints and pigments, food and beverage, petroleum, industrial coatings, agriculture, pharmaceuticals, mineral product, and other industries. The Paper Packaging & Services segment produces and sells containerboards, corrugated sheets and containers, and other corrugated and specialty products to customers in the packaging, automotive, food, and building products markets; and produces and sells coated and uncoated recycled paperboard, and recycled fiber. This segment's corrugated container products are used to ship various products, such as home appliances, small machinery, grocery products, automotive components, books, and furniture, as well as various other applications. The Land Management segment engages in harvesting and regeneration of timber properties; and sale of timberland and special use properties. As of October 31, 2023, this segment owned approximately 175,000 acres of timber properties in the southeastern United States. The company was formerly known as Greif Bros. Corporation and changed its name to Greif, Inc. in 2001. Greif, Inc. was founded in 1877 and is headquartered in Delaware, Ohio.