Considering the key profitability indicators obtained from Greif's historical financial statements, Greif Inc may not be well positioned to generate adequate gross income at the present time. It has a very high likelihood of underperforming in January. Profitability indicators assess Greif's ability to earn profits and add value for shareholders.
For Greif profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Greif to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Greif Inc utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Greif's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Greif Inc over time as well as its relative position and ranking within its peers.
Please note, there is a significant difference between Greif's value and its price as these two are different measures arrived at by different means. Investors typically determine if Greif is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Greif's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.
Greif Inc Price To Book vs. Operating Margin Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Greif's current stock value. Our valuation model uses many indicators to compare Greif value to that of its competitors to determine the firm's financial worth.
Greif Inc is rated below average in operating margin category among its peers. It is rated below average in price to book category among its peers fabricating about 16.04 of Price To Book per Operating Margin. At present, Greif's Operating Profit Margin is projected to increase slightly based on the last few years of reporting. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Greif's earnings, one of the primary drivers of an investment's value.
Greif Price To Book vs. Operating Margin
Operating Margin shows how much operating income a company makes on each dollar of sales. It is one of the profitability indicators which helps analysts to understand whether the firm is successful or not making money from everyday operations.
Greif
Operating Margin
=
Operating Income
Revenue
X
100
=
0.09 %
A good Operating Margin is required for a company to be able to pay for its fixed costs or payout its debt, which implies that the higher the margin, the better. This ratio is most effective in evaluating the earning potential of a company over time when comparing it against a firm's competitors.
Price to Book (P/B) ratio is used to relate a company book value to its current market price. A high P/B ratio indicates that investors expect executives to generate more returns on their investments from a given set of assets. Book value is the accounting value of assets minus liabilities.
Greif
P/B
=
MV Per Share
BV Per Share
=
1.42 X
Price to Book ratio is mostly used in financial services industries where assets and liabilities are typically represented by dollars. Although low Price to Book ratio generally implies that the firm is undervalued, it is often a good indicator that the company may be in financial or managerial distress and should be investigated more carefully.
Greif Price To Book Comparison
Greif is currently under evaluation in price to book category among its peers.
Greif Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Greif, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Greif will eventually generate negative long term returns. The profitability progress is the general direction of Greif's change in net profit over the period of time. It can combine multiple indicators of Greif, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Profitability drivers are factors that can directly affect your investment outlook on Greif. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Greif position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Greif's important profitability drivers and their relationship over time.
Our tools can tell you how much better you can do entering a position in Greif without increasing your portfolio risk or giving up the expected return. As an individual investor, you need to find a reliable way to track all your investment portfolios. However, your requirements will often be based on how much of the process you decide to do yourself. In addition to allowing all investors analytical transparency into all their portfolios, our tools can evaluate risk-adjusted returns of your individual positions relative to your overall portfolio.
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To fully project Greif's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Greif Inc at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Greif's income statement, its balance sheet, and the statement of cash flows.
Potential Greif investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although Greif investors may work on each financial statement separately, they are all related. The changes in Greif's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Greif's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.
