Karat Packaging (NASDAQ:KRT) Sets New 1-Year High - Still a Buy?

Key Points

• Karat Packaging shares reached a new 52-week high of $50, up from the prior close of $48.11, despite analysts’ consensus “Hold” rating and average price target of $36.50.
• The company reported strong quarterly results, with earnings of $1.48 per share versus the $0.47 estimate and revenue of $136.3 million, slightly above expectations.
• Karat Packaging increased its quarterly dividend to $0.47, implying an annualized payout of $1.88 and a 3.7% yield; institutional investors own 25.2% of outstanding shares.

Karat Packaging Inc. (NASDAQ:KRT - Get Free Report)'s share price hit a new 52-week high during trading on Tuesday . The company traded as high as $50.00 and last traded at $49.8630, with a volume of 27032 shares. The stock had previously closed at $48.11.

Wall Street Analyst Weigh In

Several equities research analysts have weighed in on the company. Lake Street Capital reissued a "buy" rating and issued a $39.00 price target on shares of Karat Packaging in a report on Friday, May 8th. Bank of America boosted their target price on shares of Karat Packaging from $23.00 to $34.00 and gave the company an "underperform" rating in a research report on Tuesday, July 14th. Zacks Research lowered Karat Packaging from a "strong-buy" rating to a "hold" rating in a research note on Tuesday, May 12th. The Goldman Sachs Group downgraded Karat Packaging to a "neutral" rating in a research note on Thursday, June 4th. Finally, William Blair upgraded Karat Packaging from a "market perform" rating to an "outperform" rating in a research report on Thursday, June 4th. Three equities research analysts have rated the stock with a Buy rating, two have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, the company currently has a consensus rating of "Hold" and an average price target of $36.50.

Karat Packaging Stock Performance

The company has a market capitalization of $1.01 billion, a price-to-earnings ratio of 20.14, a price-to-earnings-growth ratio of 2.04 and a beta of 0.82. The firm has a fifty day simple moving average of $34.82 and a 200 day simple moving average of $29.57. The company has a debt-to-equity ratio of 0.15, a current ratio of 2.29 and a quick ratio of 1.15.

Karat Packaging (NASDAQ:KRT - Get Free Report) last announced its earnings results on Thursday, August 6th. The company reported $1.48 earnings per share for the quarter, topping the consensus estimate of $0.47 by $1.01. The business had revenue of $136.30 million during the quarter, compared to the consensus estimate of $135.46 million. Karat Packaging had a return on equity of 31.42% and a net margin of 10.18%. On average, analysts anticipate that Karat Packaging Inc. will post 1.78 earnings per share for the current fiscal year.

Karat Packaging Increases Dividend

The business also recently announced a quarterly dividend, which will be paid on Friday, August 28th. Stockholders of record on Friday, August 21st will be given a $0.47 dividend. This represents a $1.88 annualized dividend and a dividend yield of 3.7%. This is a positive change from Karat Packaging's previous quarterly dividend of $0.45. The ex-dividend date is Friday, August 21st. Karat Packaging's dividend payout ratio (DPR) is 72.00%.

Institutional Inflows and Outflows

Hedge funds have recently modified their holdings of the stock. BlackRock Inc. acquired a new stake in Karat Packaging in the 2nd quarter worth about $19,840,000. Vanguard Group Inc. raised its holdings in shares of Karat Packaging by 12.0% during the third quarter. Vanguard Group Inc. now owns 477,450 shares of the company's stock valued at $12,037,000 after acquiring an additional 51,179 shares during the last quarter. Wasatch Advisors LP lifted its position in shares of Karat Packaging by 3.3% in the second quarter. Wasatch Advisors LP now owns 330,961 shares of the company's stock valued at $9,320,000 after acquiring an additional 10,617 shares in the last quarter. Ranger Investment Management L.P. lifted its position in shares of Karat Packaging by 8.1% in the first quarter. Ranger Investment Management L.P. now owns 325,104 shares of the company's stock valued at $9,077,000 after acquiring an additional 24,405 shares in the last quarter. Finally, Polar Asset Management Partners Inc. boosted its stake in shares of Karat Packaging by 57.1% in the fourth quarter. Polar Asset Management Partners Inc. now owns 314,100 shares of the company's stock worth $7,089,000 after acquiring an additional 114,204 shares during the last quarter. Institutional investors and hedge funds own 25.20% of the company's stock.

About Karat Packaging

Karat Packaging Technologies, Inc NASDAQ: KRT is a U.S.-based provider of premium packaging solutions for consumer goods and industrial products. The company specializes in the design, manufacture and delivery of high-quality litho-laminated folding cartons, tubes and flexible packaging. Karat Packaging operates an integrated production model that combines prepress, printing, converting and finishing capabilities to support the branding and shelf-appeal needs of its customers.

The company serves a diverse range of end markets, including food and beverage, confectionery, health and beauty, pharmaceuticals, specialty chemicals and promotional packaging.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

Continue following MarketBeat

Add MarketBeat as your preferred source on Google to see our latest stories in your feed.

Add As Preferred Source