How are energy investors positioned?
Investing.com - Rosenblatt lowered its price target on Quad/Graphics (NYSE:QUAD) to $8.60 from $8.90 on Thursday, while maintaining a Buy rating on the stock. According to InvestingPro data, the stock appears undervalued at its current price of $5.07, despite falling over 12% in the past week.
The price target reduction follows Quad/Graphics’ second-quarter 2025 results, which Rosenblatt described as "in-line" with expectations. The company reiterated its guidance during the earnings report. While not profitable in the last twelve months, InvestingPro analysis indicates the company is expected to return to profitability this year, with forecasted earnings of $0.89 per share.
The adjustment to the price target stems from an update to disclosures on net pension obligations, according to Rosenblatt. The firm’s valuation is based on a sum-of-the-parts analysis that applies a 4x EBITDA multiple to the company’s core operations for 2025 estimates. The company currently trades at an EV/EBITDA multiple of 3.58x, with last twelve months EBITDA of $218.9 million.
During Thursday’s conference call, Quad/Graphics shared "encouraging comments" regarding early developments at the U.S. Postal Service under new Postmaster General David Steiner, who began his role on July 15.
Rosenblatt’s valuation also factors in free cash flow expected in 2025 and cash from planned or completed property sales.
In other recent news, Quad Graphics Inc . reported its second-quarter 2025 earnings, showing a mixed financial performance. The company posted earnings per share (EPS) of $0.11, which fell short of analysts’ expectations of $0.14, marking a negative surprise of 21.43%. However, the company’s revenue exceeded projections, reaching $572 million compared to the forecast of $554.85 million, resulting in a positive surprise of 3.09%. Despite the revenue beat, the lower-than-expected EPS has raised concerns among investors about the company’s profitability. These recent developments highlight the challenges Quad Graphics faces in balancing revenue growth with profitability.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.