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Quad/Graphics, Inc. Class A (QUAD)
NYSE:QUAD
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Quad/Graphics
(NYSE:QUAD)
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Rating:57Neutral
Price Target:
$7.00
▲(11.82% Upside)
Quad/Graphics' overall stock score is driven by its financial instability and high leverage, which are significant concerns. However, positive technical indicators and strategic investments in technology provide some optimism. The valuation is challenging due to negative earnings, but the dividend yield offers a partial offset. The earnings call highlights both opportunities and risks, contributing to a balanced but cautious outlook.
Positive Factors
Strategic Investments in AI
Investments in AI enhance operational efficiency and client outcomes, positioning Quad for long-term growth in marketing solutions.
Growth in Targeted Print Offerings
Growth in targeted print offerings indicates strong demand for integrated marketing solutions, supporting revenue stability.
Improved Cash Flow Management
Improved cash flow management enhances financial resilience, providing a buffer against operational challenges and supporting future investments.
Negative Factors
High Leverage
High leverage increases financial risk, potentially limiting strategic flexibility and increasing vulnerability to economic downturns.
Decline in Net Sales
Declining net sales reflect challenges in maintaining market share and revenue growth, impacting long-term financial health.
Decreased Adjusted EBITDA
Decreased EBITDA indicates reduced profitability, which could hinder reinvestment in growth initiatives and affect competitive positioning.
Quad/Graphics (QUAD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$322.52M
Dividend Yield4.39%
Average Volume (3M)213.73K
Price to Earnings (P/E)―
Beta (1Y)1.12
Revenue Growth-6.94%
EPS Growth74.52%
CountryUS
Employees11,000
SectorIndustrials
Sector Strength72
IndustrySpecialty Business Services
Share Statistics
EPS (TTM)0.14
Shares Outstanding37,211,150
10 Day Avg. Volume170,854
30 Day Avg. Volume213,733
Financial Highlights & Ratios
PEG Ratio1.06
Price to Book (P/B)6.65
Price to Sales (P/S)0.12
P/FCF Ratio5.96
Enterprise Value/Market Cap2.47
Enterprise Value/Revenue0.31
Enterprise Value/Gross Profit1.54
Enterprise Value/Ebitda5.87
Forecast
1Y Price Target
$9.30Price Target Upside48.56% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Quad/Graphics Business Overview & Revenue Model
Company DescriptionQuad/Graphics, Inc. provides marketing solutions worldwide. The company operates through United States Print and Related Services, and International segments. It offers printing services, such as retail inserts, publications, catalogs, special interest publications, journals, direct mail, directories, in-store marketing and promotion, packaging, newspapers, custom print products, and other commercial and specialty printed products; and paper procurement services. The company also provides marketing and other services, including consumer insights, audience targeting, personalization, media planning and placement, process optimization, campaign planning and creation, pre-media production, videography, photography, digital and print execution, and logistics, as well as manufactures ink. It serves blue chip companies that operate in various industries, and serve businesses and consumers comprising retailers, publishers, and direct marketers. The company was founded in 1971 and is headquartered in Sussex, Wisconsin.
How the Company Makes MoneyQuad/Graphics generates revenue through multiple streams, primarily from its printing services, which include commercial printing, digital printing, and specialty printing. The company also earns revenue from its marketing services, which encompass strategic marketing consulting, data analytics, and digital solutions tailored to optimize clients' marketing efforts. Significant partnerships with major brands across various industries bolster its revenue, as these collaborations often lead to long-term contracts for printing and marketing services. Additionally, Quad leverages technology to streamline its operations and improve efficiency, which helps to maintain profitability in a competitive market.
Quad/Graphics Earnings Call Summary
Earnings Call Date:Jul 29, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 04, 2025
Earnings Call Sentiment Neutral
The earnings call presented a balanced outlook. While Quad is making significant strides in technology and integrated marketing solutions, leading to some growth in targeted print offerings and improved financial metrics, there are ongoing challenges with declining net sales, decreased adjusted EBITDA, and the impact of postal rate increases. The sentiment is cautiously optimistic but tempered by these challenges.Q2-2025 Updates
Positive Updates
AI and Data Innovations
Quad is investing in AI applications across process automation, cognitive insights, and cognitive engagement, optimizing marketing processes and enhancing client campaign outcomes. The launch of Audience Builder 2.0 enables faster and more efficient audience targeting, leading to significant improvements for clients, such as an 80% revenue increase for a direct mail campaign.
Growth in Targeted Print Offerings
Year-to-date, Quad saw a 7% increase in sales for direct mail and packaging and a 13% increase for in-store services, driven by integrated marketing solutions and innovative approaches that tie together complex marketing channels.
Recognition and Awards
Quad continues to receive industry recognition, ranking among Ad Age's top 25 world's largest agency companies and MM&M's Agency 100 for healthcare marketing expertise. Several leaders were acknowledged for driving growth across advertising, marketing, media, and tech.
Improved Financial Metrics
Free cash flow improved by $16 million compared to the previous year, driven by increased cash earnings, lower restructuring payments, and decreased capital expenditures. Adjusted diluted earnings per share increased from $0.12 to $0.14 year-over-year for the quarter.
Negative Updates
Decline in Net Sales
Net sales were $572 million in Q2 2025, a 4% decrease excluding the impact of the European operations divestiture. Year-to-date net sales decreased by 3%, primarily due to lower paper, logistics, and agency solutions sales.
Decreased Adjusted EBITDA
Adjusted EBITDA decreased from $52 million in Q2 2024 to $43 million in Q2 2025, with the margin declining from 8.2% to 7.6%. This was primarily due to lower sales and increased investments in innovative offerings.
Challenges with Postal Rate Increases
The USPS implemented an 11% postal rate increase, adding to the 50-70% increases over the past 4 years. Rising postal rates continue to challenge clients, although a 10% discount test for catalogers offers some temporary relief.
Impact of Divestitures
The divestiture of European operations impacted sales and financial performance. This divestiture contributed to a decline in net sales and adjusted EBITDA margins.
Company Guidance
During Quad's Second Quarter 2025 Conference Call, the company reaffirmed its 2025 guidance, projecting net sales to decline by 2% to 6% compared to 2024, excluding the impact from the divestiture of European operations. Adjusted EBITDA is expected to range between $180 million and $220 million, with a midpoint of $200 million, and free cash flow is anticipated to be between $40 million and $60 million. The net debt leverage ratio is projected to decrease to approximately 1.5x by the end of 2025. The company highlighted strategic investments in AI and data applications, including the launch of Audience Builder 2.0, enhancing audience targeting capabilities. Despite a 4% sales decline in Q2 2025, excluding European operations, Quad anticipates higher sequential adjusted EBITDA in the third and fourth quarters due to seasonal production peaks. The company is closely monitoring the impacts of tariffs and inflationary pressures, as well as the recent postal rate increases, which could affect print and marketing spend.Quad/Graphics Financial Statement Overview
Summary
Quad/Graphics faces significant challenges with declining revenue and profitability, compounded by high leverage and negative net income. The company's ability to generate cash flow remains a positive aspect, though it is overshadowed by financial instability and risks associated with high debt. Strategic improvements in operational efficiency and debt management are crucial for future stability and growth.Income Statement
Quad/Graphics has experienced a decline in revenue and profitability. The gross profit margin for TTM is 20.08%, and the net profit margin is -0.55%, indicating operational challenges. The company also shows a negative revenue growth rate of -3.28% in the last reported annual period. EBITDA margin for TTM is 5.25%, demonstrating moderate earnings before depreciation and amortization. The net losses in recent periods highlight significant profitability issues.45
Neutral
Balance Sheet
The balance sheet reflects a high debt-to-equity ratio of 6.14, indicating a leveraged position that could pose financial risks. The equity ratio stands at 7.01%, showing a reliance on debt for financing. Return on equity for TTM is -16.44%, highlighting challenges in generating returns for shareholders. The company needs to improve its equity base and manage debt levels effectively.50
Neutral
Cash Flow
Despite operational challenges, Quad/Graphics maintains a positive operating cash flow of $119.6 million for TTM. The free cash flow has grown by 28.51% annually, showing effective capital expenditure management. The operating cash flow to net income ratio is notable at -8.36, emphasizing the discrepancy between cash flow and accounting profitability. However, free cash flow to net income ratio is -5.01, indicating cash flow resilience despite net losses.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.58B | 2.67B | 2.96B | 3.22B | 2.96B | 2.93B |
| Gross Profit | 519.00M | 580.00M | 576.50M | 598.20M | 570.50M | 594.80M |
| EBITDA | 135.70M | 122.50M | 150.60M | 252.20M | 245.60M | 150.40M |
| Net Income | -14.30M | -50.90M | -55.40M | 9.30M | 37.80M | -106.40M |
Balance Sheet | ||||||
| Total Assets | 1.24B | 1.30B | 1.51B | 1.70B | 1.89B | 1.93B |
| Cash, Cash Equivalents and Short-Term Investments | 6.70M | 29.20M | 52.90M | 25.20M | 179.90M | 55.20M |
| Total Debt | 534.60M | 464.60M | 625.30M | 685.10M | 931.60M | 1.01B |
| Total Liabilities | 1.15B | 1.25B | 1.39B | 1.53B | 1.75B | 1.84B |
| Stockholders Equity | 87.00M | 49.90M | 119.50M | 172.90M | 136.80M | 84.10M |
Cash Flow | ||||||
| Free Cash Flow | 71.60M | 55.70M | 76.80M | 94.30M | 86.50M | 129.20M |
| Operating Cash Flow | 119.60M | 112.90M | 147.60M | 154.60M | 136.50M | 190.20M |
| Investing Cash Flow | -19.30M | 12.70M | -46.40M | -60.50M | 129.40M | 9.70M |
| Financing Cash Flow | -108.20M | -149.10M | -73.60M | -248.70M | -140.90M | -223.60M |
Quad/Graphics Technical Analysis
Neutral
6.26
Price Trends
6.29
Negative
5.91
Positive
5.96
Positive
Market Momentum
0.03
Positive
42.31
Neutral
7.23
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For QUAD, the sentiment is Neutral. The current price of 6.26 is below the 20-day moving average (MA) of 6.59, below the 50-day MA of 6.29, and above the 200-day MA of 5.96, indicating a neutral trend. The MACD of 0.03 indicates Positive momentum. The RSI at 42.31 is Neutral, neither overbought nor oversold. The STOCH value of 7.23 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for QUAD.
Quad/Graphics Risk Analysis
Quad/Graphics disclosed 29 risk factors in its most recent earnings report. Quad/Graphics reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Quad/Graphics Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $2.79B | 24.79 | 6.33% | 2.21% | 4.27% | -24.06% | |
70 Outperform | $863.09M | 79.40 | 2.77% | ― | -35.28% | -90.34% | |
66 Neutral | $1.03B | 3.14 | 64.13% | ― | -49.92% | 3773.09% | |
60 Neutral | $524.54M | 21.34 | 8.37% | 3.15% | -3.57% | -6.69% | |
57 Neutral | $322.52M | ― | -17.22% | 4.39% | -6.94% | 74.52% | |
53 Neutral | $284.30M | -9.46 | -15.91% | 4.35% | -10.60% | -201.64% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
QUAD
Quad/Graphics
6.26
1.80
40.36%
ABM
ABM Industries
46.12
-4.48
-8.85%
CASS
Cass Information Systems
39.33
-0.09
-0.23%
PRSU
Pursuit Attractions and Hospitality
36.18
0.54
1.52%
CVEO
Civeo
23.00
-3.66
-13.73%
TH
Target Hospitality
8.48
0.92
12.17%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.