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Richards Packaging (RPI.UN) (TSE:RPI.UN)
:RPI.UN
Canadian Market

Richards Packaging (RPI.UN) AI Stock Analysis

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Richards Packaging

(TSX:RPI.UN)

76Outperform
Richards Packaging shows strong fundamentals with efficient operational management and a robust cash flow position. However, revenue decline is a key risk factor. The stock's technical indicators suggest moderate positive momentum, while its valuation appears attractive with a low P/E ratio and a healthy dividend yield. Addressing revenue concerns could further enhance its overall performance.

Richards Packaging (RPI.UN) vs. S&P 500 (SPY)

Richards Packaging Business Overview & Revenue Model

Company DescriptionRichards Packaging Income Fund (RPI.UN) is a leading packaging distributor in North America, specializing in the distribution of a comprehensive range of rigid packaging solutions. The company's core products include plastic and glass containers, closures, and related packaging products, primarily serving the food, beverage, healthcare, cosmetics, and industrial sectors. With a strong presence across Canada and the United States, Richards Packaging leverages its extensive network and expertise to deliver customized packaging solutions to its diverse client base.
How the Company Makes MoneyRichards Packaging generates revenue primarily through the sale and distribution of packaging products to a wide range of industries. The company's key revenue streams include the distribution of plastic and glass containers, closures, and other packaging products, tailored to meet the specific needs of clients in sectors such as food, beverage, healthcare, cosmetics, and industrial applications. The company benefits from long-standing relationships with its suppliers and customers, enabling it to maintain a stable supply chain and meet customer demand efficiently. Additionally, Richards Packaging's strategic partnerships with manufacturers and its expansive distribution network contribute significantly to its earnings by enhancing its ability to provide high-quality packaging solutions and services across North America.

Richards Packaging Financial Statement Overview

Summary
Richards Packaging demonstrates strong operational efficiency and prudent financial management through stable margins and low leverage. Cash flow metrics are robust, but the decline in revenue is a concern that needs addressing to ensure long-term growth. Maintaining operational efficiency while working on reversing the revenue decline could significantly improve the company's financial standing.
Income Statement
72
Positive
The company's TTM revenue shows a slight decline compared to the previous year, indicating some revenue pressure. Gross and net profit margins are stable, with a gross margin of 18.7% and a net margin of 9.1% in TTM. However, both EBIT and EBITDA margins are strong at 12.9% and 15.7% respectively, showcasing good operational efficiency. The company needs to focus on reversing the revenue decline to improve its income statement performance.
Balance Sheet
68
Positive
The company's debt-to-equity ratio is 0.19 in TTM, reflecting a conservative leverage approach, which is a strength. However, the equity ratio stands at 60.6%, indicating a strong reliance on equity financing. Return on Equity (ROE) is moderate at 19.3% for the TTM, suggesting efficient use of equity but room for improvement. The balance sheet is generally stable, but the company could benefit from optimizing its equity usage.
Cash Flow
75
Positive
The TTM free cash flow to net income ratio is high at 1.42, indicating strong cash generation relative to net income. The operating cash flow to net income ratio is 1.46, showing robust operating cash flow. However, the free cash flow growth rate has declined due to reduced revenue. Overall, cash flow management is a strong point for the company, though improvements in revenue could further enhance cash flow health.
Breakdown
TTMDec 2023Dec 2022Dec 2021Dec 2020Dec 2019
Income StatementTotal Revenue
411.81M425.93M446.90M451.44M489.24M334.15M
Gross Profit
77.04M78.11M82.09M88.39M112.69M57.49M
EBIT
53.10M55.74M58.73M63.63M93.25M44.12M
EBITDA
64.53M71.44M79.61M38.63M91.00M47.65M
Net Income Common Stockholders
37.40M38.89M45.17M2.07M50.14M21.73M
Balance SheetCash, Cash Equivalents and Short-Term Investments
27.47M8.12M5.45M8.42M7.72M8.02M
Total Assets
270.93M318.20M349.89M356.90M352.88M248.01M
Total Debt
51.14M53.17M101.23M64.03M72.62M58.41M
Net Debt
23.68M45.06M95.78M55.60M64.90M50.39M
Total Liabilities
130.00M138.06M188.39M226.06M192.31M121.28M
Stockholders Equity
140.93M180.15M161.50M130.83M160.57M126.73M
Cash FlowFree Cash Flow
53.18M80.47M41.63M54.51M71.68M38.20M
Operating Cash Flow
54.74M83.19M43.15M56.87M74.34M39.97M
Investing Cash Flow
-5.79M-2.71M-51.05M-11.49M-54.58M-1.76M
Financing Cash Flow
-56.88M-78.18M4.75M-44.95M-21.46M-36.36M

Richards Packaging Technical Analysis

Technical Analysis Sentiment
Negative
Last Price27.75
Price Trends
50DMA
29.94
Negative
100DMA
29.71
Negative
200DMA
29.80
Negative
Market Momentum
MACD
-0.59
Positive
RSI
29.11
Positive
STOCH
6.89
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:RPI.UN, the sentiment is Negative. The current price of 27.75 is below the 20-day moving average (MA) of 29.05, below the 50-day MA of 29.94, and below the 200-day MA of 29.80, indicating a bearish trend. The MACD of -0.59 indicates Positive momentum. The RSI at 29.11 is Positive, neither overbought nor oversold. The STOCH value of 6.89 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:RPI.UN.

Richards Packaging Peers Comparison

Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
$12.66B14.8517.16%1.73%8.95%64.88%
76
Outperform
8.5518.66%4.71%-3.15%-1.63%
TSTRP
71
Outperform
$70.36B15.2116.85%5.80%5.31%61.02%
TSWPK
71
Outperform
C$2.42B12.0511.45%0.41%0.56%4.94%
59
Neutral
$12.43B10.562.81%3.69%1.58%-17.58%
49
Neutral
$563.36M-33.54%20.29%-106.22%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:RPI.UN
Richards Packaging
27.75
-3.01
-9.79%
TSE:BLDP
Ballard Power Systems
1.88
-1.84
-49.46%
TSE:TRP
TC Energy
67.71
21.09
45.25%
TSE:CCL.B
CCL Industries
71.72
1.71
2.45%
TSE:WPK
Winpak Limited
39.15
1.49
3.96%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.