Critical Contrast: Greif (GEF) vs. The Competition

Greif (NYSE:GEF) is one of 70 public companies in the “Containers & Packaging” industry, but how does it weigh in compared to its peers? We will compare Greif to similar companies based on the strength of its institutional ownership, risk, profitability, valuation, analyst recommendations, earnings and dividends.

Dividends

Greif pays an annual dividend of $2.48 per share and has a dividend yield of 3.5%. Greif pays out 56.0% of its earnings in the form of a dividend. As a group, “Containers & Packaging” companies pay a dividend yield of 5.0% and pay out -80.0% of their earnings in the form of a dividend. Greif has raised its dividend for 4 consecutive years. Greif lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.

Profitability

This table compares Greif and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Greif	5.91%	7.78%	4.13%
Greif Competitors	-20.65%	5.08%	1.60%

Earnings & Valuation

This table compares Greif and its peers top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Greif	$4.38 billion	$258.50 million	16.02
Greif Competitors	$6.04 billion	$199.65 million	12.14

Greif’s peers have higher revenue, but lower earnings than Greif. Greif is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Institutional & Insider Ownership

45.7% of Greif shares are owned by institutional investors. Comparatively, 54.4% of shares of all “Containers & Packaging” companies are owned by institutional investors. 7.7% of Greif shares are owned by insiders. Comparatively, 13.5% of shares of all “Containers & Packaging” companies are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Volatility and Risk

Greif has a beta of 0.79, indicating that its share price is 21% less volatile than the S&P 500. Comparatively, Greif’s peers have a beta of 0.75, indicating that their average share price is 25% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Greif and its peers, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Greif	2	2	2	0	2.00
Greif Competitors	404	2395	3477	86	2.51

Greif presently has a consensus price target of $82.20, indicating a potential upside of 15.80%. As a group, “Containers & Packaging” companies have a potential upside of 39.30%. Given Greif’s peers stronger consensus rating and higher possible upside, analysts plainly believe Greif has less favorable growth aspects than its peers.

Summary

Greif peers beat Greif on 9 of the 15 factors compared.

About Greif

Greif, Inc. is a global industrial packaging company that makes products used to store and transport goods. Its offerings include steel, plastic and fiber drums, intermediate bulk containers, jerrycans and other rigid packaging, as well as reconditioned containers and related services. The company also provides packaging accessories and services such as container filling, supply-chain support and packaging design. Greif serves customers in industries including chemicals, food and beverage, petroleum and pharmaceuticals.