Greif Bros. Corporation (GEF) & Silgan Holdings (SLGN) Financial Review
Silgan Holdings (NASDAQ: SLGN) and Greif Bros. Corporation (NYSE:GEF) are both mid-cap industrial products companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.
Insider & Institutional Ownership
67.0% of Silgan Holdings shares are held by institutional investors. Comparatively, 47.8% of Greif Bros. Corporation shares are held by institutional investors. 33.1% of Silgan Holdings shares are held by company insiders. Comparatively, 16.4% of Greif Bros. Corporation shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Risk and Volatility
Silgan Holdings has a beta of 0.53, suggesting that its share price is 47% less volatile than the S&P 500. Comparatively, Greif Bros. Corporation has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500.
This is a summary of current recommendations and price targets for Silgan Holdings and Greif Bros. Corporation, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Greif Bros. Corporation||1||3||3||0||2.29|
Silgan Holdings currently has a consensus target price of $32.33, suggesting a potential upside of 9.79%. Greif Bros. Corporation has a consensus target price of $57.00, suggesting a potential downside of 3.78%. Given Silgan Holdings’ higher possible upside, equities analysts plainly believe Silgan Holdings is more favorable than Greif Bros. Corporation.
Earnings & Valuation
This table compares Silgan Holdings and Greif Bros. Corporation’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Silgan Holdings||$3.77 billion||0.86||$470.07 million||$1.24||23.75|
|Greif Bros. Corporation||$3.54 billion||0.43||$459.50 million||$1.59||37.26|
Silgan Holdings has higher revenue and earnings than Greif Bros. Corporation. Silgan Holdings is trading at a lower price-to-earnings ratio than Greif Bros. Corporation, indicating that it is currently the more affordable of the two stocks.
Silgan Holdings pays an annual dividend of $0.36 per share and has a dividend yield of 1.2%. Greif Bros. Corporation pays an annual dividend of $1.68 per share and has a dividend yield of 2.8%. Silgan Holdings pays out 29.0% of its earnings in the form of a dividend. Greif Bros. Corporation pays out 105.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Greif Bros. Corporation has raised its dividend for 13 consecutive years. Greif Bros. Corporation is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares Silgan Holdings and Greif Bros. Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Greif Bros. Corporation||2.65%||15.49%||4.74%|
Silgan Holdings beats Greif Bros. Corporation on 9 of the 17 factors compared between the two stocks.
About Silgan Holdings
Silgan Holdings Inc. is a holding company. The Company is a manufacturer of rigid packaging for consumer goods products. The Company operates in three business segments: metal containers, closures and plastic containers. Its metal container segment is engaged in the manufacture and sale of steel and aluminum containers for human and pet food and general line products. Its closures segment manufactures and sells metal, composite and plastic closures for food and beverage products. Its plastic containers segment manufactures and sells custom designed plastic containers and closures for personal care, food, healthcare, pharmaceutical, household and industrial chemical, pet care, agricultural, automotive and marine chemical products. The Company is a manufacturer of metal containers in North America and Europe. As of December 31, 2016, the Company’s products were used for a range of end markets and it operated 87 manufacturing plants in North America, Europe, Asia and South America.
About Greif Bros. Corporation
Greif, Inc. is a producer of industrial packaging products and services. The Company’s segments are Rigid Industrial Packaging & Services; Paper Packaging & Services; Flexible Products & Services, and Land Management. The Rigid Industrial Packaging & Services segment is engaged in the production and sale of rigid industrial packaging products, and services, such as container life cycle management, filling, logistics, warehousing and other packaging services. The Paper Packaging & Services segment is engaged in the production and sale of containerboard, corrugated sheets, corrugated containers and other corrugated products. The Flexible Products & Services segment is engaged in the production and sale of flexible intermediate bulk containers and related services on a global basis. The Land Management segment is involved in the management and sale of timber. As of October 31, 2016, the Company had operations in over 45 countries.
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