GPK Is Best Way To Capitalize On Pricing Momentum In Paper And Packaging Industry, Jefferies Reports

With Graphic Packaging Holding Company GPK having a market leading position in both CUK (55% share) and CRB (31% share), “we believe it's the best way to capitalize on the pricing momentum in the paperboard industry,” Jefferies reports. “While there is an inherent price lag in its folding carton business (9 month average), we believe it sets the stage for a multi-year pricing story in our favorite small cap packaging company,” Jefferies writes. “With the majority of its contracts resetting during 2Q11, we expect the company to reach price / cost parity by 2Q11, benefiting from the paperboard price increases in 2010.” Graphic Packaging closed Thursday at $5.03.