Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Graphic Packaging Holding Company (NYSE:GPK) jumped as much as 10% today after reporting earnings that came in well ahead of estimates.
So what: Fourth-quarter revenue actually fell 7% to $1.0 billion but was in-line with what analysts were expecting. But net income of $41.5 million, or $0.21 per share on an adjusted basis was six cents ahead of estimate.
To top off the solid quarter, management announced a $0.05 per share quarterly dividend and a $250 million share repurchase program.
Now what: Graphic Packaging has been divesting from some of its businesses, so adjusting for that, revenue from ongoing operations was up 5.6% in the quarter, not bad in a highly competitive environment. More than the earnings beat, management's confidence to pay a dividend and implement a share repurchase program are great signs for investors. Shares are still pretty expensive at 19 times forward estimates, but if operations continue to improve the stock could continue to hit new highs.