Neutral Rating Maintained Amid Paperboard Pricing Headwinds and Leadership Turnover Uncertainty

In a report released yesterday, Ghansham Panjabi from Robert W. Baird downgraded Graphic Packaging to a Hold, with a price target of $18.00.

Ghansham Panjabi has given his Hold rating due to a combination of factors tied to both industry conditions and company-specific developments. He sees ongoing pressure in key paperboard markets, particularly in the SBS grade, where price declines driven by weak demand and excess capacity create downside risk to earnings. Although other grades that Graphic Packaging produces have been more resilient so far, he highlights the potential for substitution and broader pricing uncertainty that could weigh on profitability. These industry headwinds, together with a difficult share price performance in the prior year, limit near-term upside despite an unchanged valuation framework.

Panjabi also points to substantial leadership turnover, including recent changes in both the CEO and CFO roles, as a source of added caution. This management disruption comes just as the company was expected to benefit from stronger free cash flow following a major capital project, raising questions about the durability of its long-term financial targets and strategic direction. Until the new leadership team clarifies its earnings outlook, capital allocation, and longer-term growth algorithm, he prefers to remain on the sidelines with a Neutral stance. His $18 price target, based on a roughly 10x multiple of his 2026 EPS estimate, implies a balanced risk/reward profile that, in his view, does not justify a more aggressive rating at this time.

According to TipRanks, Panjabi is a 4-star analyst with an average return of 5.2% and a 57.56% success rate. Panjabi covers the Consumer Cyclical sector, focusing on stocks such as Graphic Packaging, Greif Class A, and Sealed Air.

In another report released yesterday, Truist Financial also maintained a Hold rating on the stock with a $18.00 price target.