Intrinsic value of Graphic Packaging Holding Company - GPK

Previous Close

$13.89

  Intrinsic Value

$33.48

stock screener

  Rating & Target

str. buy

+141%

Previous close

$13.89

 
Intrinsic value

$33.48

 
Up/down potential

+141%

 
Rating

str. buy

We calculate the intrinsic value of GPK stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 4.1

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  35.80
  32.72
  29.95
  27.45
  25.21
  23.19
  21.37
  19.73
  18.26
  16.93
  15.74
  14.67
  13.70
  12.83
  12.05
  11.34
  10.71
  10.14
  9.62
  9.16
  8.74
  8.37
  8.03
  7.73
  7.46
  7.21
  6.99
  6.79
  6.61
  6.45
Revenue, $m
  8,179
  10,855
  14,106
  17,979
  22,511
  27,731
  33,657
  40,298
  47,655
  55,725
  64,495
  73,954
  84,085
  94,872
  106,300
  118,356
  131,029
  144,311
  158,198
  172,690
  187,790
  203,509
  219,857
  236,851
  254,513
  272,866
  291,939
  311,765
  332,379
  353,819
Variable operating expenses, $m
  7,446
  9,817
  12,698
  16,129
  20,145
  24,770
  30,020
  35,905
  42,424
  49,574
  57,147
  65,528
  74,504
  84,062
  94,188
  104,871
  116,099
  127,868
  140,173
  153,013
  166,394
  180,321
  194,806
  209,864
  225,513
  241,776
  258,676
  276,242
  294,507
  313,505
Fixed operating expenses, $m
  29
  29
  30
  31
  31
  32
  33
  33
  34
  35
  36
  36
  37
  38
  39
  40
  41
  41
  42
  43
  44
  45
  46
  47
  48
  49
  50
  51
  53
  54
Total operating expenses, $m
  7,475
  9,846
  12,728
  16,160
  20,176
  24,802
  30,053
  35,938
  42,458
  49,609
  57,183
  65,564
  74,541
  84,100
  94,227
  104,911
  116,140
  127,909
  140,215
  153,056
  166,438
  180,366
  194,852
  209,911
  225,561
  241,825
  258,726
  276,293
  294,560
  313,559
Operating income, $m
  705
  1,009
  1,379
  1,820
  2,335
  2,929
  3,604
  4,360
  5,197
  6,116
  7,313
  8,390
  9,543
  10,772
  12,073
  13,446
  14,889
  16,401
  17,983
  19,633
  21,353
  23,143
  25,004
  26,940
  28,951
  31,041
  33,213
  35,471
  37,819
  40,261
EBITDA, $m
  1,363
  1,818
  2,370
  3,029
  3,799
  4,687
  5,694
  6,823
  8,075
  9,447
  10,939
  12,547
  14,270
  16,105
  18,049
  20,099
  22,255
  24,514
  26,876
  29,341
  31,909
  34,583
  37,363
  40,254
  43,258
  46,380
  49,624
  52,997
  56,503
  60,150
Interest expense (income), $m
  65
  160
  266
  397
  557
  747
  970
  1,226
  1,517
  1,843
  2,205
  2,601
  3,032
  3,497
  3,994
  4,524
  5,086
  5,678
  6,301
  6,953
  7,635
  8,347
  9,089
  9,861
  10,664
  11,499
  12,367
  13,268
  14,205
  15,179
  16,192
Earnings before tax, $m
  545
  744
  982
  1,263
  1,588
  1,960
  2,378
  2,843
  3,354
  3,911
  4,712
  5,358
  6,047
  6,777
  7,549
  8,360
  9,211
  10,101
  11,030
  11,998
  13,005
  14,054
  15,143
  16,275
  17,452
  18,674
  19,945
  21,266
  22,639
  24,069
Tax expense, $m
  147
  201
  265
  341
  429
  529
  642
  768
  906
  1,056
  1,272
  1,447
  1,633
  1,830
  2,038
  2,257
  2,487
  2,727
  2,978
  3,239
  3,511
  3,794
  4,089
  4,394
  4,712
  5,042
  5,385
  5,742
  6,113
  6,498
Net income, $m
  398
  543
  717
  922
  1,159
  1,431
  1,736
  2,075
  2,448
  2,855
  3,440
  3,911
  4,414
  4,947
  5,511
  6,103
  6,724
  7,374
  8,052
  8,758
  9,494
  10,259
  11,054
  11,881
  12,740
  13,632
  14,560
  15,524
  16,527
  17,570

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  9,589
  12,726
  16,537
  21,078
  26,391
  32,510
  39,457
  47,242
  55,868
  65,328
  75,610
  86,699
  98,575
  111,221
  124,619
  138,753
  153,609
  169,180
  185,460
  202,450
  220,153
  238,580
  257,745
  277,668
  298,374
  319,890
  342,250
  365,492
  389,658
  414,794
Adjusted assets (=assets-cash), $m
  9,589
  12,726
  16,537
  21,078
  26,391
  32,510
  39,457
  47,242
  55,868
  65,328
  75,610
  86,699
  98,575
  111,221
  124,619
  138,753
  153,609
  169,180
  185,460
  202,450
  220,153
  238,580
  257,745
  277,668
  298,374
  319,890
  342,250
  365,492
  389,658
  414,794
Revenue / Adjusted assets
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
  0.853
Average production assets, $m
  4,736
  6,285
  8,168
  10,410
  13,034
  16,056
  19,487
  23,332
  27,592
  32,265
  37,343
  42,819
  48,685
  54,931
  61,548
  68,528
  75,866
  83,556
  91,596
  99,987
  108,731
  117,832
  127,297
  137,137
  147,363
  157,989
  169,033
  180,512
  192,447
  204,861
Working capital, $m
  777
  1,031
  1,340
  1,708
  2,139
  2,634
  3,197
  3,828
  4,527
  5,294
  6,127
  7,026
  7,988
  9,013
  10,099
  11,244
  12,448
  13,710
  15,029
  16,406
  17,840
  19,333
  20,886
  22,501
  24,179
  25,922
  27,734
  29,618
  31,576
  33,613
Total debt, $m
  4,918
  7,353
  10,310
  13,834
  17,957
  22,705
  28,096
  34,137
  40,831
  48,172
  56,151
  64,755
  73,972
  83,785
  94,182
  105,150
  116,678
  128,761
  141,395
  154,578
  168,316
  182,615
  197,488
  212,948
  229,015
  245,712
  263,063
  281,099
  299,852
  319,358
Total liabilities, $m
  7,441
  9,876
  12,833
  16,356
  20,479
  25,228
  30,619
  36,660
  43,354
  50,694
  58,673
  67,278
  76,494
  86,308
  96,704
  107,672
  119,201
  131,284
  143,917
  157,101
  170,839
  185,138
  200,010
  215,471
  231,538
  248,234
  265,586
  283,622
  302,375
  321,880
Total equity, $m
  2,148
  2,851
  3,704
  4,721
  5,912
  7,282
  8,838
  10,582
  12,514
  14,633
  16,937
  19,420
  22,081
  24,914
  27,915
  31,081
  34,409
  37,896
  41,543
  45,349
  49,314
  53,442
  57,735
  62,198
  66,836
  71,655
  76,664
  81,870
  87,283
  92,914
Total liabilities and equity, $m
  9,589
  12,727
  16,537
  21,077
  26,391
  32,510
  39,457
  47,242
  55,868
  65,327
  75,610
  86,698
  98,575
  111,222
  124,619
  138,753
  153,610
  169,180
  185,460
  202,450
  220,153
  238,580
  257,745
  277,669
  298,374
  319,889
  342,250
  365,492
  389,658
  414,794
Debt-to-equity ratio
  2.290
  2.580
  2.780
  2.930
  3.040
  3.120
  3.180
  3.230
  3.260
  3.290
  3.320
  3.330
  3.350
  3.360
  3.370
  3.380
  3.390
  3.400
  3.400
  3.410
  3.410
  3.420
  3.420
  3.420
  3.430
  3.430
  3.430
  3.430
  3.440
  3.440
Adjusted equity ratio
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  398
  543
  717
  922
  1,159
  1,431
  1,736
  2,075
  2,448
  2,855
  3,440
  3,911
  4,414
  4,947
  5,511
  6,103
  6,724
  7,374
  8,052
  8,758
  9,494
  10,259
  11,054
  11,881
  12,740
  13,632
  14,560
  15,524
  16,527
  17,570
Depreciation, amort., depletion, $m
  658
  809
  991
  1,209
  1,464
  1,757
  2,090
  2,464
  2,877
  3,331
  3,626
  4,157
  4,727
  5,333
  5,976
  6,653
  7,366
  8,112
  8,893
  9,707
  10,556
  11,440
  12,359
  13,314
  14,307
  15,339
  16,411
  17,525
  18,684
  19,889
Funds from operations, $m
  1,056
  1,351
  1,708
  2,131
  2,623
  3,188
  3,826
  4,539
  5,326
  6,186
  7,065
  8,068
  9,141
  10,281
  11,486
  12,756
  14,090
  15,486
  16,945
  18,466
  20,050
  21,699
  23,413
  25,195
  27,047
  28,971
  30,971
  33,049
  35,211
  37,459
Change in working capital, $m
  205
  254
  309
  368
  431
  496
  563
  631
  699
  767
  833
  899
  962
  1,025
  1,086
  1,145
  1,204
  1,262
  1,319
  1,377
  1,435
  1,493
  1,553
  1,614
  1,678
  1,744
  1,812
  1,883
  1,958
  2,037
Cash from operations, $m
  851
  1,097
  1,399
  1,763
  2,193
  2,692
  3,263
  3,908
  4,627
  5,419
  6,232
  7,170
  8,178
  9,256
  10,400
  11,611
  12,886
  14,224
  15,625
  17,089
  18,616
  20,206
  21,860
  23,581
  25,369
  27,227
  29,159
  31,166
  33,253
  35,423
Maintenance CAPEX, $m
  -339
  -460
  -610
  -793
  -1,011
  -1,265
  -1,559
  -1,892
  -2,265
  -2,679
  -3,132
  -3,626
  -4,157
  -4,727
  -5,333
  -5,976
  -6,653
  -7,366
  -8,112
  -8,893
  -9,707
  -10,556
  -11,440
  -12,359
  -13,314
  -14,307
  -15,339
  -16,411
  -17,525
  -18,684
New CAPEX, $m
  -1,246
  -1,550
  -1,882
  -2,242
  -2,624
  -3,022
  -3,431
  -3,845
  -4,260
  -4,672
  -5,078
  -5,476
  -5,866
  -6,246
  -6,617
  -6,980
  -7,338
  -7,690
  -8,041
  -8,391
  -8,743
  -9,101
  -9,466
  -9,840
  -10,226
  -10,627
  -11,043
  -11,479
  -11,935
  -12,414
Cash from investing activities, $m
  -1,585
  -2,010
  -2,492
  -3,035
  -3,635
  -4,287
  -4,990
  -5,737
  -6,525
  -7,351
  -8,210
  -9,102
  -10,023
  -10,973
  -11,950
  -12,956
  -13,991
  -15,056
  -16,153
  -17,284
  -18,450
  -19,657
  -20,906
  -22,199
  -23,540
  -24,934
  -26,382
  -27,890
  -29,460
  -31,098
Free cash flow, $m
  -734
  -912
  -1,093
  -1,272
  -1,442
  -1,596
  -1,727
  -1,829
  -1,899
  -1,932
  -1,979
  -1,932
  -1,845
  -1,717
  -1,550
  -1,345
  -1,105
  -832
  -527
  -195
  165
  549
  955
  1,382
  1,829
  2,294
  2,776
  3,276
  3,792
  4,324
Issuance/(repayment) of debt, $m
  1,961
  2,435
  2,958
  3,523
  4,123
  4,749
  5,391
  6,042
  6,694
  7,341
  7,979
  8,605
  9,216
  9,813
  10,397
  10,968
  11,529
  12,083
  12,633
  13,184
  13,738
  14,299
  14,872
  15,460
  16,067
  16,696
  17,352
  18,036
  18,753
  19,505
Issuance/(repurchase) of shares, $m
  170
  160
  137
  95
  31
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  2,131
  2,595
  3,095
  3,618
  4,154
  4,749
  5,391
  6,042
  6,694
  7,341
  7,979
  8,605
  9,216
  9,813
  10,397
  10,968
  11,529
  12,083
  12,633
  13,184
  13,738
  14,299
  14,872
  15,460
  16,067
  16,696
  17,352
  18,036
  18,753
  19,505
Total cash flow (excl. dividends), $m
  1,398
  1,683
  2,001
  2,346
  2,712
  3,153
  3,664
  4,212
  4,795
  5,409
  6,000
  6,673
  7,372
  8,097
  8,847
  9,623
  10,424
  11,251
  12,106
  12,989
  13,903
  14,848
  15,827
  16,842
  17,896
  18,990
  20,128
  21,312
  22,545
  23,830
Retained Cash Flow (-), $m
  -568
  -703
  -854
  -1,017
  -1,190
  -1,371
  -1,556
  -1,744
  -1,932
  -2,119
  -2,303
  -2,484
  -2,660
  -2,833
  -3,001
  -3,166
  -3,328
  -3,488
  -3,647
  -3,806
  -3,966
  -4,128
  -4,293
  -4,463
  -4,638
  -4,820
  -5,009
  -5,206
  -5,413
  -5,630
Prev. year cash balance distribution, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
  829
  980
  1,148
  1,329
  1,522
  1,782
  2,108
  2,468
  2,863
  3,290
  3,697
  4,189
  4,711
  5,264
  5,846
  6,457
  7,096
  7,763
  8,459
  9,184
  9,937
  10,720
  11,534
  12,380
  13,258
  14,171
  15,119
  16,106
  17,132
  18,199
Discount rate, %
  11.00
  11.55
  12.13
  12.73
  13.37
  14.04
  14.74
  15.48
  16.25
  17.06
  17.92
  18.81
  19.75
  20.74
  21.78
  22.87
  24.01
  25.21
  26.47
  27.80
  29.19
  30.65
  32.18
  33.79
  35.48
  37.25
  39.11
  41.07
  43.12
  45.28
PV of cash for distribution, $m
  747
  787
  814
  823
  812
  810
  805
  781
  738
  681
  603
  529
  452
  376
  304
  239
  183
  136
  98
  68
  46
  30
  19
  11
  7
  4
  2
  1
  1
  0
Current shareholders' claim on cash, %
  96.0
  93.4
  91.7
  90.8
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6
  90.6

Graphic Packaging Holding Company is a provider of paper-based packaging solutions for a range of products to food, beverage and other consumer product companies. The Company's segments include Paperboard Mills, Americas Paperboard Packaging, Europe Paperboard Packaging, and Corporate and Other. The Paperboard Mills segment includes the Company's North American paperboard mills, which produce primarily coated unbleached kraft and coated recycled board. As of December 31, 2016, the Company had seven paperboard mills in North America. The Americas Paperboard Packaging segment includes paperboard folding cartons sold primarily to consumer packaged goods (CPG) companies serving the food, beverage and consumer product markets in the Americas. The Europe Paperboard Packaging segment includes paperboard folding cartons sold primarily to CPG companies serving the food, beverage and consumer product markets in Europe. The Corporate and Other segment includes the Pacific Rim operating segment.

FINANCIAL RATIOS  of  Graphic Packaging Holding Company (GPK)

Valuation Ratios
P/E Ratio 19.1
Price to Sales 1
Price to Book 4.1
Price to Tangible Book
Price to Cash Flow 6.8
Price to Free Cash Flow 12.6
Growth Rates
Sales Growth Rate 3.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 20.9%
Cap. Spend. - 3 Yr. Gr. Rate 7.1%
Financial Strength
Quick Ratio 1
Current Ratio 0
LT Debt to Equity 197.6%
Total Debt to Equity 203.6%
Interest Coverage 6
Management Effectiveness
Return On Assets 6.2%
Ret/ On Assets - 3 Yr. Avg. 5%
Return On Total Capital 7.4%
Ret/ On T. Cap. - 3 Yr. Avg. 6%
Return On Equity 21.1%
Return On Equity - 3 Yr. Avg. 17.2%
Asset Turnover 1
Profitability Ratios
Gross Margin 18.4%
Gross Margin - 3 Yr. Avg. 18.8%
EBITDA Margin 15.9%
EBITDA Margin - 3 Yr. Avg. 14.2%
Operating Margin 9.2%
Oper. Margin - 3 Yr. Avg. 8.2%
Pre-Tax Margin 7.4%
Pre-Tax Margin - 3 Yr. Avg. 6.4%
Net Profit Margin 5.3%
Net Profit Margin - 3 Yr. Avg. 4.3%
Effective Tax Rate 29.2%
Eff/ Tax Rate - 3 Yr. Avg. 33.3%
Payout Ratio 28.1%

GPK stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the GPK stock intrinsic value calculation we used $6023 million for the last fiscal year's total revenue generated by Graphic Packaging Holding Company. The default revenue input number comes from 0001 income statement of Graphic Packaging Holding Company. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our GPK stock valuation model: a) initial revenue growth rate of 35.8% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 11%, whose default value for GPK is calculated based on our internal credit rating of Graphic Packaging Holding Company, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Graphic Packaging Holding Company.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of GPK stock the variable cost ratio is equal to 91.9%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $28 million in the base year in the intrinsic value calculation for GPK stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for Graphic Packaging Holding Company.

Corporate tax rate of 27% is the nominal tax rate for Graphic Packaging Holding Company. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the GPK stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for GPK are equal to 57.9%.

Life of production assets of 10.3 years is the average useful life of capital assets used in Graphic Packaging Holding Company operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for GPK is equal to 9.5%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $1579.5 million for Graphic Packaging Holding Company - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 297.276 million for Graphic Packaging Holding Company is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Graphic Packaging Holding Company at the current share price and the inputted number of shares is $4.1 billion.

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