Investors interested in Containers - Paper and Packaging stocks are likely familiar with Graphic Packaging (GPK) and AptarGroup (ATR). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, Graphic Packaging has a Zacks Rank of #2 (Buy), while AptarGroup has a Zacks Rank of #4 (Sell). Investors should feel comfortable knowing that GPK likely has seen a stronger improvement to its earnings outlook than ATR has recently. But this is just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
GPK currently has a forward P/E ratio of 14.15, while ATR has a forward P/E of 33.98. We also note that GPK has a PEG ratio of 0.57. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. ATR currently has a PEG ratio of 4.85.
Another notable valuation metric for GPK is its P/B ratio of 1.88. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, ATR has a P/B of 4.35.
Based on these metrics and many more, GPK holds a Value grade of B, while ATR has a Value grade of D.
GPK stands above ATR thanks to its solid earnings outlook, and based on these valuation figures, we also feel that GPK is the superior value option right now.
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Graphic Packaging Holding Company (GPK) : Free Stock Analysis Report
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