Greif Inc. Stock Upgraded (GEF)

NEW YORK ( TheStreet) -- Greif (NYSE: GEF) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company has had somewhat weak growth in earnings per share.

Highlights from the ratings report include:
  • GEF's revenue growth trails the industry average of 27.2%. Since the same quarter one year prior, revenues slightly increased by 5.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has significantly increased by 110.56% to $7.20 million when compared to the same quarter last year. In addition, GREIF INC has also vastly surpassed the industry average cash flow growth rate of 40.82%.
  • The change in net income from the same quarter one year ago has significantly exceeded that of the Containers & Packaging industry average, but is less than that of the S&P 500. The net income has significantly decreased by 42.3% when compared to the same quarter one year ago, falling from $41.44 million to $23.90 million.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Containers & Packaging industry and the overall market on the basis of return on equity, GREIF INC has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
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Greif, Inc. manufactures and sells industrial packaging products, bulk containers, and containerboard and corrugated products worldwide. The company has a P/E ratio of 17.1, above the average consumer non-durables industry P/E ratio of 16.1 and below the S&P 500 P/E ratio of 17.7. Greif has a market cap of $1.21 billion and is part of the consumer goods sector and consumer non-durables industry. Shares are up 12.5% year to date as of the close of trading on Thursday.

You can view the full Greif Ratings Report or get investment ideas from our investment research center.
-- Written by a member of TheStreet RatingsStaff
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