Graphic Packaging Holding Company (NYSE:GPK) shares have been experiencing accelerated earnings and sales growth over the past five years. Over that time frame the firm has seen earnings growth of -3.00% and sales growth of 9.50%.
While the firm has enjoyed the upward movement, it’s important to look at analyst expectations and where the company is headed from here. On a consensus basis, analysts are projecting EPS growth of 23.73% for next year and have a $21.23 one year price target on the stock. The stock recently traded at $18.75.
Six Fundamental Characteristics of Great Growth Stocks
#6 Huge Mass Markets – The more potential customers there are, the greater the possibility that both the company, and the investment in said company, will be a success.
#5 Market Dominance/Barriers to Entry – Look for companies who hold patents. This is great barrier to entry, ensuring no competition. Look for companies who dominate the market, blowing away the competition, though market dominance can be harder to measure.
#4 Accelerating Earnings Growth – If a company’s earnings growth rate increases for two consecutive quarters, their growth is accelerating. Faster growth is better growth, and a company whose earnings growth rate is accelerating is an attractive investment.
#3 Triple-Digit Revenue Growth – Companies growing their revenues at triple-digit rates (100% or better) are usually smaller and less known, making them attractive for buying by institutions.
#2 High Profit Margins – In recent decades, high-margin stocks have beaten low-margin stocks by a huge amount.
#1 Top Notch, Innovative Management – All great managers who led their companies to success usually did so by thinking differently. There is no surefire and quick measurement of management talent. When you find a top manager, one with a record of prior success and accolades, you should strike. Top managers usually find a way to overcome obstacles.
Let’s take a look at how the stock has been performing recently. Over the past twelve months, Graphic Packaging Holding Company (NYSE:GPK)’s stock was 10.68%. Over the last week of the month, it was 8.38%, 4.11% over the last quarter, and 12.61% for the past six months.
Earnings Per Share (EPS):
EPS is what each share is worth and indicates how much money their sharehoders would acquire if the company was to pay out all of its profits. Earnings Per Share is computed by dividing the profit total by its share total. If a company’s profit is $800 million and there are 40 million shares, then the EPS is $20. EPS is a fantastic way to compare and contrast companies in the same industry. When a company shows a steady upwards earnings trend, it is a good indicator that the company will dominate companies with a more volatile earnings trend.
Graphic Packaging Holding Company (NYSE:GPK)’s EPS is 0.85. Last year, their EPS growth was -14.70% while their EPS growth over the past five years is -3.00%. Analysts are predicting Graphic Packaging Holding Company’s stock to grow 23.73% over the next year and 19.68% over the next five.