Critical Survey: Greif Bros. (NYSE:GEF.B) versus Amcor (NYSE:AMCR)

Greif Bros. (NYSE:GEF.B) and Amcor (NYSE:AMCR) are both industrials companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, risk, valuation, institutional ownership, earnings and profitability.

Insider & Institutional Ownership

5.1% of Greif Bros. shares are owned by institutional investors. Comparatively, 45.1% of Amcor shares are owned by institutional investors. 16.2% of Greif Bros. shares are owned by company insiders. Comparatively, 0.6% of Amcor shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Greif Bros. and Amcor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Greif Bros.	3.74%	10.21%	3.23%
Amcor	5.99%	26.49%	6.11%

Analyst Recommendations

This is a breakdown of recent ratings for Greif Bros. and Amcor, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Greif Bros.	0	0	0	0	0.00
Amcor	0	2	8	0	2.80

Amcor has a consensus price target of $11.5143, suggesting a potential upside of 22.30%. Given Amcor’s stronger consensus rating and higher probable upside, analysts plainly believe Amcor is more favorable than Greif Bros..

Earnings & Valuation

This table compares Greif Bros. and Amcor”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Greif Bros.	$5.45 billion	0.59	$268.80 million	$3.62	18.75
Amcor	$13.46 billion	1.01	$730.00 million	$0.56	16.81

Amcor has higher revenue and earnings than Greif Bros.. Amcor is trading at a lower price-to-earnings ratio than Greif Bros., indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Greif Bros. has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500. Comparatively, Amcor has a beta of 0.74, suggesting that its share price is 26% less volatile than the S&P 500.

Dividends

Greif Bros. pays an annual dividend of $3.24 per share and has a dividend yield of 4.8%. Amcor pays an annual dividend of $0.51 per share and has a dividend yield of 5.4%. Greif Bros. pays out 89.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Amcor pays out 91.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Amcor has raised its dividend for 5 consecutive years. Amcor is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Amcor beats Greif Bros. on 12 of the 17 factors compared between the two stocks.

About Greif Bros.

Greif, Inc. produces and sells industrial packaging products and services worldwide. It operates through four segments: Rigid Industrial Packaging & Services; Paper Packaging & Services; Flexible Products & Services; and Land Management. The Rigid Industrial Packaging & Services segment offers rigid industrial packaging products, including steel, fiber, and plastic drums; rigid intermediate bulk containers; closure systems for industrial packaging products; transit protection products; water bottles, and remanufactured and reconditioned industrial containers; and services, such as container life cycle management, filling, logistics, warehousing, and other packaging services. This segment sells its products to customers in the chemicals, paints and pigments, food and beverage, petroleum, industrial coatings, agricultural, pharmaceutical and minerals, and other industries. The Paper Packaging & Services segment provides containerboards, corrugated sheets, corrugated containers, and other corrugated and specialty products to customers in the packaging, automotive, food, and building products markets. This segment's corrugated container products are used to ship various products, such as home appliances, small machinery, grocery products, automotive components, books, and furniture, as well as various other applications. The Flexible Products & Services segment offers flexible intermediate bulk containers comprising polypropylene-based woven fabric, as well as related services to the agricultural, food, and other industries. The Land Management segment engages in harvesting and regeneration of timber properties; and sale of timberland and special use land. As of October 31, 2020, this segment owned approximately 244,000 acres of timber property in the southeastern United States. The company was formerly known as Greif Bros. Corporation and changed its name to Greif, Inc. in 2001. Greif, Inc. was founded in 1877 and is based in Delaware, Ohio.

About Amcor

Amcor plc develops, produces, and sells packaging products in Europe, North America, Latin America, Africa, and the Asia Pacific regions. The company operates through two segments, Flexibles and Rigid Packaging. The Flexibles segment provides flexible and film packaging products in the food and beverage, medical and pharmaceutical, fresh produce, snack food, personal care, and other industries. The Rigid Packaging segment offers rigid containers for various beverage and food products, including carbonated soft drinks, water, juices, sports drinks, milk-based beverages, spirits and beer, sauces, dressings, spreads, and personal care items; and plastic caps for various applications. The company sells its products through its direct sales force. Amcor plc was incorporated in 2018 and is headquartered in Zurich, Switzerland.