Graphic Packaging Holdings: Q2‘26 earnings: Stronger than expected, but FCF guidance cut and leverage revision negative, in our view

Research evidence excerpt

Graphic Packaging Holdings: Q2‘26 earnings: Stronger than expected, but FCF guidance cut and leverage revision negative, in our view

Detlef Winckelmann AC Europe Equity Research

(44-20) 3493-5190 04 August 2026 J P M O R G A N

detlef.winckelmann@jpmorgan.com

Investment Thesis, Valuation and Risks

Graphic Packaging Holdings (Neutral; Price Target: $11.70)

Investment Thesis

Graphic Packaging Holdings (GPK) has a market leading position in a heavily consolidated

boxboard industry with exposure to multiple consumer end markets. Furthermore, relative

to peers, GPK stands out as being well invested, low cost and exposed to high(er) growth

boxboard grades. Despite this, we take a dim view of the market itself which, to date, has

not shown evidence of volume growth or pricing power. Macro pressures are expected to

make volume growth more difficult than normal and surplus industry supply is likely to

make cost recovery through pricing even harder. GPK, which is aware of the situation, has

initiated some self-help actions in terms of cost savings and FCF improvement, which is

sorely needed considering that we view GPKs leverage as excessive (2026e: ~5.7x net debt/

EBITDA). While our base case suggests some valuation upside, risks to the downside

remain and so long as gearing remains high, the impact of downward earnings revisions will

weigh more than usual. With limited upside catalysts, multiple downside risks and a “fair

valuation” we see investors avoiding the stock until market dynamics improve.

Accordingly, we maintain a Neutral recommendation with a December 2027 price target of

$11.7/share.

Valuation

We value GPK on a one-year forward EV/EBITDA multiple of 7.4x.

Risks to Rating and Price Target

Upside risks

• Supply side rationalisation