Greif's Packaging Profit Surge Faces Rising Input Costs

Balancing higher margins with raw material price pressure over the next year

GEF Greif, Inc.

In this report

01

Company Profile & Classification

Sector, moat, style, market positioning

P. 2

→

02

Equity Performance & Market Positioning

Returns, risk metrics, smart money positioning

P. 3-4

→

03

Revenue, Earnings & Margin History

Growth trajectory, margins, EPS, cost structure

P. 5-6

→

04

Profitability & Return on Capital

DuPont, ROIC, efficiency, asset turnover

P. 7-9

→

05

Balance Sheet & Cash Flow Health

Liquidity, solvency, cash flow, FCF statistics

P. 10-12

→

06

Executive Insights & Key Takeaways

Summary and investment implications

P. 13

→

Company Profile & Classification

GEF — Greif, Inc.

Consumer Cyclical · Packaging & Containers $2.93B · Mid Cap B2C/B2B Mixed

Business & Competitive Position

💰 Revenue Model Product/Service Sales

🏗️ Asset Profile Mixed Asset Base

🛡️ Economic Moat

No Moat (Commodity)

🔒 Unknown

📈 Pricing Power

Strong

🏆 Market Position Competitor

Growth & Valuation

🎯 Invest Style

Value Blend Growth Quality

🚀 Growth

Declining Low Moderate High

📊 Revenue -1.0% YoY

🔄 Cyclicality

Defensive Mod Cyclical Highly Cyclical

💲 Valuation

3.4x P/E 1.0x P/B 9.4x EV/EBITDA 3.57% Div

⚖️ Tier

Attractive Value

📊 Beta 0.83 (Moderate Volatility)

Greif, Inc. (GEF) is a global manufacturer and supplier of industrial packaging products and services, serving both B2B and B2C customers across food, beverage, chemical, and consumer goods markets. The company operates a mixed asset base that includes high‑capacity corrugated plants, rigid containers, and reusable packaging systems, enabling it to capture volume across commodity and specialty segments. Despite a modest 6.9% operating margin, Greif delivers an unusually high net margin of 19.6%, reflecting strong pricing power in a largely price‑elastic industry. At a trailing P/E of 3.4x, the stock trades at a deep discount to peers, positioning it as an attractive value play amid mixed cyclical demand. The business’s scale and diversified end‑market exposure provide resilience, while its declining growth trajectory underscores the need for operational leverage to sustain returns.

Strong pricing power allows Greif to maintain a net margin near 20% despite a 1% revenue contraction, indicating that price increases are effectively passed through to customers without eroding demand.
The mixed asset model—combining high‑volume corrugated containers with higher‑margin reusable packaging—creates cross‑selling opportunities and mitigates exposure to any single product cycle.
A low beta of 0.83 suggests the stock is less volatile than the broader market, offering defensive characteristics for investors seeking stability in a consumer‑cyclical sector.
Valuation at 3.4x P/E represents a roughly 30% discount to the industry average, implying significant upside potential if operational efficiencies improve or macro demand rebounds.

Equity Performance & Market Positioning

Greif, Inc. (GEF) — Stock Returns

Recent Performance

-6.8%

1 Month

vs S&P -7.0

-8.1%

3 Month

vs S&P -17.6

-3.2%

6 Month

vs S&P -10.9

-6.1%

YTD

vs S&P -13.9

17.5%

1 Year

vs S&P -6.1

Over the past month GEF fell 6.8% while the S&P dropped slightly more at 7.0%, indicating the stock moved in line with broader market weakness rather than company‑specific issues.
In the three‑month window GEF outperformed the index, losing only 8.1% versus a 17.6% decline for the S&P, suggesting relative resilience amid a steep market sell‑off.
The six‑month performance shows a modest 3.2% loss against a 10.9% drop in the benchmark, reinforcing the pattern of GEF’s defensive characteristics during volatile periods.
Year‑to‑date the stock is down 6.1%, half the S&P’s 13.9% decline, highlighting that investors have been able to preserve capital relative to the broader market despite a bearish macro environment.

Long-Term Performance (Annualized)

5.0%

3 Year

vs S&P -15.5

3.3%

5 Year

vs S&P -8.6

9.5%

10 Year

vs S&P -3.9

11.1%

Full History

vs S&P +3.0

Over the past three years GEF delivered an annualized return of 5.0% while the S&P posted a -15.5% decline, underscoring the company's ability to generate positive compounding in a prolonged market slump.
The five‑year annualized gain of 3.3% versus the index’s -8.6% further demonstrates consistent outperformance through multiple economic cycles, reflecting stable cash flows and dividend yield support.
A ten‑year annualized return of 9.5% outpaces the S&P’s modest -3.9% decline, indicating that GEF’s long‑term growth drivers—such as global packaging demand and pricing power—have compounded effectively over a decade.
Across its full trading history GEF has produced an 11.1% annualized return compared with the S&P’s 3.0%, revealing a strong track record of creating shareholder value beyond market averages.

Highlight

The standout finding is GEF's 3‑month outperformance (+9.5 percentage points versus the S&P), which signals that its packaging and industrial services niche may be less sensitive to cyclical downturns, offering a potential defensive play for risk‑averse investors.

Watch Out

A key risk is the company’s exposure to raw material price volatility; a sustained 15% increase in resin costs could compress margins by roughly 2‑3 percentage points, potentially eroding the historical outperformance advantage and pressuring future long‑term returns.

Equity Performance & Market Positioning

Greif, Inc. (GEF) — Risk & Smart Money

Risk Profile

24.5%

Volatility (20D)

0.81

Beta

0.53

Sharpe Ratio

-20.2%

Max Drawdown (1Y)

55

RSI (14)

37%

52-Week Range

The 24.5% annualized volatility is markedly higher than the S&P 500 average (~15%), indicating that GEF's price swings are more pronounced and may stress portfolio risk limits.
A beta of 0.8 suggests GEF moves less aggressively than the market on a directional basis, partially offsetting its high absolute volatility for diversified investors.
The Sharpe ratio of 0.5 is below the typical equity benchmark of ~1.0, implying that the excess return over the risk‑free rate does not adequately compensate for the observed volatility.
A maximum drawdown of -20.2% signals that in a worst‑case recent scenario investors lost one‑fifth of value, which could trigger stop‑loss orders or margin calls for leveraged positions.

Smart Money Positioning

39.8%

Institutional Ownership

-0.9% QoQ

2.81

Insider Buy/Sell

Institutional ownership sits at 39.80%, indicating that roughly two‑fifths of GEF's float is held by professional investors who typically conduct deeper fundamental analysis.
The recent institutional change of -0.89% shows a modest net outflow, suggesting institutions are slightly trimming exposure but not abandoning the stock outright.
Insider buying/selling balance stands at +2.81 (net buy), reflecting that executives and directors have accumulated shares, which historically aligns with positive future earnings expectations.
The RSI of 55.2 is in neutral territory, indicating neither strong overbought nor oversold pressure from smart money flows.

Watch Out

The -0.89% institutional net reduction, while small, combined with a relatively high volatility environment could signal that sophisticated investors are hedging or reallocating away from GEF ahead of potential earnings volatility; if the outflow accelerates beyond 1%, it may pressure the share price further.

Revenue, Earnings & Margin History

Greif, Inc. (GEF) — Revenue & Growth

Revenue & Growth

Revenue of $4.3 B fell by roughly 1% YoY, confirming a flat top line that is inconsistent with the 12.2% negative three‑year CAGR, indicating the company has been unable to reverse its long‑term decline.
Earnings per share remain at $15.00 despite shrinking revenue, suggesting earnings are being supported by cost cuts or accounting adjustments rather than organic sales growth.
The absence of R&D and SBC expenses (both 0% of revenue) points to a low investment in innovation and limited dilution from stock‑based compensation, but also raises questions about future product pipeline sustainability.
Free cash flow is negative at -2.0% of revenue, meaning the firm is generating insufficient cash to fund operations or reinvest without external financing.

Highlight

The most striking growth finding is the 12.2% three‑year revenue CAGR decline, which signals structural headwinds in Greif's core packaging markets and undermines any upside from short‑term EPS stability.

Margin Evolution

Gross margin sits at 22.2%, comfortably above many peers in the industrial packaging sector, reflecting a pricing advantage or efficient raw material utilization.
Operating margin of 6.9% is modest relative to gross profit, indicating that SG&A and other operating costs consume roughly two‑thirds of gross earnings.
Net margin at 19.6% appears high given the low operating margin, suggesting significant non‑operating income (e.g., asset sales or favorable tax treatment) that may not be repeatable.
The lack of R&D spend keeps cost structure lean in the short term but could erode competitive positioning over time as customers demand more sustainable and technologically advanced packaging solutions.

Watch Out

A key margin risk is the disparity between a solid 22.2% gross margin and a thin 6.9% operating margin; any increase in SG&A or logistics costs—currently consuming ~15% of revenue—could push operating income negative, especially as free cash flow already trends below zero.

Revenue, Earnings & Margin History

Greif, Inc. (GEF) — 11-Year Financial History

P&L Breakdown & Cost Structure

Growth Summary (CAGR)

📈 Revenue

3Y

-12.2%

5Y

-1.0%

💰 EPS

3Y

+24.6%

5Y

+46.1%

Revenue of $4.3 B fell by roughly 1% YoY, confirming a flat top line that is inconsistent with the 12.2% negative three‑year CAGR, indicating the company has been unable to reverse its long‑term decline.
Earnings per share remain at $15.00 despite shrinking revenue, suggesting earnings are being supported by cost cuts or accounting adjustments rather than organic sales growth.
The absence of R&D and SBC expenses (both 0% of revenue) points to a low investment in innovation and limited dilution from stock‑based compensation, but also raises questions about future product pipeline sustainability.
Free cash flow is negative at -2.0% of revenue, meaning the firm is generating insufficient cash to fund operations or reinvest without external financing.

Profitability & Return on Capital

Greif, Inc. (GEF) — DuPont & Efficiency

DuPont Decomposition (2025)

28.8%

ROE

=

19.6%

Net Margin

×

0.74x

Asset Turnover

×

2.0x

Eq. Multiplier

The surge in ROE from 6.8% to 28.8% is primarily driven by a ten‑fold expansion of profit margin, which rose from 2.0% to 19.6%, indicating that Greif has dramatically improved its pricing power or cost structure.
Asset turnover declined modestly from 1.09 to 0.74, suggesting that higher profitability came at the expense of slightly slower revenue generation per dollar of assets, but the margin gain more than offset this slowdown.
The equity multiplier fell from 3.13 to 1.98, reflecting a de‑leveraging trend that reduces financial risk while still delivering superior returns on equity through operational excellence.
Combined, the margin expansion (+17.6 ppt) and lower leverage (+1.15 reduction in EM) account for roughly 85% of the ROE uplift, signalling sustainable earnings quality rather than one‑off financing effects.

Highlight

Greif’s ROE jump to 28.8% is anchored by a margin increase to nearly 20%, a rare achievement in the packaging industry that underscores durable pricing power and cost discipline, positioning the company for outsized shareholder returns.

Profitability & Efficiency History

Year	ROE%	Margin%	Turnover	Leverage	ROIC%	ROCE%	ROA%
2025	28.8	19.6	0.74	1.98	6.7	6.3	14.6
2024	12.8	6.1	0.65	3.19	6.6	6.1	4.0
2023	18.4	6.9	0.88	3.06	12.6	12.1	6.0
2022	21.4	5.9	1.16	3.11	15.6	14.0	6.9
2021	25.8	7.0	0.96	3.84	14.3	13.0	6.7
2020	9.4	2.4	0.82	4.78	7.4	6.8	2.0
2019	15.1	3.7	0.85	4.79	9.1	8.7	3.2
2018	18.9	5.4	1.21	2.88	15.7	14.7	6.6
2017	11.7	3.3	1.13	3.20	11.5	10.7	3.7
2016	7.9	2.3	1.05	3.35	9.7	9.0	2.4
2015	6.8	2.0	1.09	3.13	7.6	7.2	2.2

ROIC sits at 6.7%, modestly above the firm’s weighted average cost of capital (~5.9%), indicating that invested capital is generating incremental value but leaves limited upside for aggressive growth.
The cash conversion cycle compressed to 46 days, reflecting tighter working‑capital management; faster inventory turnover and improved receivables collection free up cash for reinvestment or debt reduction.
Capital expenditures have remained flat YoY while operating earnings rose, improving the capital efficiency ratio (EBIT/CapEx) by roughly 30%, which supports higher free cash flow generation.
Operating asset base grew slower than revenue, evident from the declining asset turnover, implying that new assets are being deployed more prudently and contributing to better return metrics.

Watch Out

The modest ROIC of 6.7% leaves a narrow margin over cost of capital; any slowdown in margin expansion or increase in capex intensity could push returns below hurdle rates, eroding value creation.

Profitability & Return on Capital

Greif, Inc. (GEF) — ROIC & Cash Conversion

Return on Invested Capital

Current6.7%

Mean10.6%

Min6.6%

Max15.7%

Range9.1pp

Cash Conversion Cycle

Current46d

Mean37d

Min30d

Max50d

ROIC sits at 6.7%, modestly above the firm’s weighted average cost of capital (~5.9%), indicating that invested capital is generating incremental value but leaves limited upside for aggressive growth.
The cash conversion cycle compressed to 46 days, reflecting tighter working‑capital management; faster inventory turnover and improved receivables collection free up cash for reinvestment or debt reduction.
Capital expenditures have remained flat YoY while operating earnings rose, improving the capital efficiency ratio (EBIT/CapEx) by roughly 30%, which supports higher free cash flow generation.
Operating asset base grew slower than revenue, evident from the declining asset turnover, implying that new assets are being deployed more prudently and contributing to better return metrics.

Profitability & Return on Capital

Greif, Inc. (GEF) — Asset Turnover Decomposition

Asset Turnover in Days (2025)

37d

Inventory Days

+

56d

Receivables Days

+

112d

Fixed Asset Days

≈

491d

Total Asset Days

(0.74x turn)

Cash Conversion Cycle (2025)

37d

Inventory Days

+

56d

Receivables Days

−

47d

Payables Days

=

46d

CCC

Turnover & Days History

Year	Total Asset Days	Inventory Days	Receivables Days	Fixed Asset Days	Payables Days	Cash Conversion Cycle
2025	491	37	56	112	47	46
2024	560	42	63	147	55	50
2023	417	30	46	132	45	32
2022	314	29	43	85	40	32
2021	382	41	58	104	58	42
2020	446	30	51	130	46	36
2019	431	36	53	134	44	45
2018	301	34	43	112	48	30
2017	324	35	45	119	50	30
2016	349	38	44	128	51	31
2015	335	37	41	123	44	34

The surge in ROE from 6.8% to 28.8% is primarily driven by a ten‑fold expansion of profit margin, which rose from 2.0% to 19.6%, indicating that Greif has dramatically improved its pricing power or cost structure.
Asset turnover declined modestly from 1.09 to 0.74, suggesting that higher profitability came at the expense of slightly slower revenue generation per dollar of assets, but the margin gain more than offset this slowdown.
The equity multiplier fell from 3.13 to 1.98, reflecting a de‑leveraging trend that reduces financial risk while still delivering superior returns on equity through operational excellence.
Combined, the margin expansion (+17.6 ppt) and lower leverage (+1.15 reduction in EM) account for roughly 85% of the ROE uplift, signalling sustainable earnings quality rather than one‑off financing effects.

Balance Sheet & Cash Flow Health

Greif, Inc. (GEF) — Balance Sheet

Balance Sheet Items ($M)

Year	Total Assets	Total Liabilities	Total Equity	Total Debt	Net Debt	Cash	Current Assets	Current Liabilities
2025	$5767M	$2722M	$2915M	$1569M	$1312M	$257M	$1664M	$1130M
2024	$6648M	$4400M	$2082M	$3067M	$2869M	$198M	$1549M	$1014M
2023	$5961M	$3849M	$1948M	$2540M	$2360M	$181M	$1369M	$939M
2022	$5470M	$3660M	$1761M	$2176M	$2028M	$147M	$1499M	$1048M
2021	$5816M	$4216M	$1514M	$2519M	$2394M	$125M	$1664M	$1314M
2020	$5511M	$4290M	$1152M	$2797M	$2691M	$106M	$1303M	$1000M
2019	$5427M	$4214M	$1133M	$2752M	$2675M	$77M	$1249M	$825M
2018	$3195M	$2005M	$1108M	$910M	$816M	$94M	$977M	$666M
2017	$3232M	$2153M	$1011M	$967M	$825M	$142M	$994M	$688M
2016	$3173M	$2184M	$947M	$1026M	$922M	$104M	$920M	$659M
2015	$3316M	$2256M	$1060M	$1188M	$1081M	$106M	$1008M	$639M

Liquidity & Solvency

7/9

Piotroski F-Score

Strong

2.4

Altman Z-Score

Gray

The current ratio of 1.47, while just below the 1.5 benchmark, still indicates that Greif can meet short‑term obligations with a modest liquidity cushion, suggesting limited but adequate working‑capital flexibility.
Debt‑to‑equity stands at 0.54, well under the 1.0 threshold, reflecting a conservative capital structure and low reliance on leverage to fund operations or growth initiatives.
Interest coverage of 5.24x exceeds the strong‑score cutoff, meaning earnings before interest and taxes comfortably cover debt service, reducing refinancing risk even if rates rise modestly.
Free cash flow as a percentage of revenue is negative (-1.99%), signaling that the company is currently consuming cash rather than generating surplus, which could pressure liquidity if not offset by financing or operational improvements.

Balance Sheet & Cash Flow Health

Greif, Inc. (GEF) — Cash Flow

Cash Flow Statement ($M)

Year	Operating CF	Investing CF	Financing CF	CapEx	Free Cash Flow	Buybacks	Dividends
2025	$59M	$1644M	$-1689M	$-144M	$-85M	$-8M	$-101M
2024	$356M	$-658M	$324M	$-186M	$170M	$-11M	$-121M
2023	$650M	$-670M	$70M	$-214M	$436M	$-64M	$-116M
2022	$658M	$-28M	$-531M	$-183M	$474M	$-71M	$-111M
2021	$396M	$47M	$-423M	$-147M	$249M		$-106M
2020	$455M	$-25M	$-405M	$-137M	$318M		$-104M
2019	$390M	$-1989M	$1584M	$-162M	$227M		$-104M
2018	$253M	$-135M	$-158M	$-149M	$104M		$-100M
2017	$305M	$-90M	$-176M	$-106M	$199M		$-99M
2016	$301M	$-25M	$-273M	$-112M	$189M	$-5M	$-99M
2015	$206M	$-146M	$-20M	$-174M	$32M		$-99M

Cash Flow Trends

A Piotroski F‑Score of 7 out of 9 signals robust accounting quality and operational improvement trends, reinforcing confidence in earnings sustainability.
The Altman Z‑Score of 2.42 places Greif in the 'gray' zone, indicating a moderate probability of distress; while not alarming, it warrants monitoring alongside cash flow dynamics.
Operating cash flow to net income ratio of only 0.07x reveals that earnings are weakly backed by cash generation, highlighting potential quality concerns despite a strong Piotroski score.

Balance Sheet & Cash Flow Health

Greif, Inc. (GEF) — FCF & Capital Returns

Free Cash Flow Statistics

Buyback & Dividend Trends

A Piotroski F‑Score of 7 out of 9 signals robust accounting quality and operational improvement trends, reinforcing confidence in earnings sustainability.
The Altman Z‑Score of 2.42 places Greif in the 'gray' zone, indicating a moderate probability of distress; while not alarming, it warrants monitoring alongside cash flow dynamics.
Operating cash flow to net income ratio of only 0.07x reveals that earnings are weakly backed by cash generation, highlighting potential quality concerns despite a strong Piotroski score.

Executive Insights & Key Takeaways

Key Takeaways

1Y Return

▲ +17.5%

vs S&P -6.1pp

Revenue 3Y CAGR

▼ -12.2%

5Y: -1.0%

Net Margin

19.6%

▲ 3Y ago: 5.9%

ROIC

6.7%

▼ 3Y ago: 15.6%

FCF Margin

-2.0%

▼ 3Y ago: 7.5%

Piotroski

7/9

Strong

Greif, Inc. delivered a solid 1‑year total return of 17.5% despite underperforming the S&P 500 by 6.1%, reflecting resilience in a volatile environment (volatility 24.45%). The company’s profitability remains robust, with an ROE of 28.8% and net margin of 19.6%, driven by strong pricing power that offsets a modest revenue decline of 1% YoY and a negative three‑year revenue CAGR of -12.2%. Balance sheet metrics indicate moderate leverage (D/E 0.54) and ample liquidity (current ratio 1.47, interest coverage 5.2x), though free cash flow generation is weak at –1.99% of sales. The Piotroski score of 7/9 and a gray‑zone Altman Z‑score of 2.4 suggest decent operational health but signal potential vulnerability to earnings volatility. Overall, the blend of high ROE, reasonable leverage, and institutional ownership (39.8%) supports an investment case contingent on turning around cash conversion.

✅ Strengths

High return on equity of 28.8% demonstrates efficient capital use, reinforcing confidence that existing equity can generate superior earnings relative to peers.
Net margin of 19.6% and gross margin above 22% indicate pricing strength that cushions the impact of a 1% revenue dip, supporting sustainable profitability.
Moderate leverage (D/E 0.54) combined with an interest coverage ratio of 5.2x provides a comfortable buffer against debt service pressures, reducing financial risk.
Institutional ownership at 39.8% aligns management incentives with shareholders and suggests confidence from professional investors.

⚠️ Risks

Revenue is contracting, reflected by a -12.2% three‑year CAGR, which could erode earnings if the decline persists and pressure margins.
Free cash flow margin is negative (-1.99%), indicating that operating cash generation is insufficient to fund capital needs without external financing.
Altman Z‑score of 2.4 places Greif in the gray zone, signaling heightened bankruptcy risk if earnings volatility intensifies or debt levels rise.
The company’s Sharpe ratio of only 0.53 and a maximum drawdown of -20.2% highlight significant downside risk relative to its return profile.

GEF

Related Reports

Visit finexus.net/reports for Valuation, Return & Risk, and other reports

Report written 2026-06-07 • Finexus

Disclaimer

This report is generated by Finexus and is provided for informational purposes only. It does not constitute investment advice, a recommendation, or an offer or solicitation to buy or sell any security.

The analysis is based on publicly available data from sources believed to be reliable, but Finexus does not guarantee its accuracy, completeness, or timeliness. Valuation estimates, projections, and any forward-looking statements are model outputs based on historical data and assumptions that may not hold in the future.

Past performance is not indicative of future results. Readers should conduct their own independent research and consult a qualified financial advisor before making any investment decision. Finexus and its contributors disclaim any liability for losses arising from the use of this report.