L1 Capital International, an investment management company, released its second quarter 2022 investor letter. A copy of the same can be downloaded here. The fund returned -10.1% net of fees in the second quarter compared to the benchmark return of -8.5%. Current macroeconomic issues and geopolitical situations affected the fund’s performance in the quarter. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.
L1 Capital International discussed stocks like Graphic Packaging Holding Company (NYSE:GPK) in the second quarter investor letter. Headquartered in Atlanta, Georgia, Graphic Packaging Holding Company (NYSE:GPK) is a paper-based packaging solutions provider. On September 6, 2022, Graphic Packaging Holding Company (NYSE:GPK) stock closed at $22.59 per share. Graphic Packaging Holding Company (NYSE:GPK) had a return of -2.25% for the past month and its shares gained 10.79% of their value in the last 52 weeks. Graphic Packaging Holding Company (NYSE:GPK) has a market capitalization of $6.954 billion.
Here is what L1 Capital International specifically said about Graphic Packaging Holding Company (NYSE:GPK) in its Q2 2022 investor letter:
“The investment thesis for Graphic Packaging Holding Company (NYSE:GPK) was outlined in detail in the June 2021 Quarterly Report. Since then, the performance of the business has been in line with or ahead of our base case, and the share price has performed well in challenging equity market conditions. Demand for Graphic Packaging’s products remains steady, low single digits growth supported by a consistent environmentally driven shift to paperboard-based packaging and away from plastic packaging.
Even though Graphic Packaging is relatively low growth, it still meets all our criteria for a high-quality business – long term positive business drivers, leader in a well-structured industry with rational competitors and barriers to increased competition, experienced and aligned management and favourable financial metrics. Financial leverage is relatively high but is reducing as strong free cashflow is allocated to debt repayment. One of the central criteria we look for in the businesses we invest in is pricing power. Graphic Packaging has demonstrated the ability to increase the price for its products to offset cost pressures, without reducing demand or losing market.
Despite strong absolute and relative share price performance, Graphic Packaging still only trades on a forward PE of 10x and 9% free cashflow yield, highly attractive given the dependability and low macroeconomic sensitivity of this business.”
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Graphic Packaging Holding Company (NYSE:GPK) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 31 hedge fund portfolios held Graphic Packaging Holding Company (NYSE:GPK) at the end of the second quarter which was 29 in the previous quarter.
We discussed Graphic Packaging Holding Company (NYSE:GPK) in another article and shared the list of stocks under $30 to buy according to David Einhorn’s Greenlight Capital. In addition, please check out our hedge fund investor letters Q2 2022 page for more investor letters from hedge funds and other leading investors.
Disclosure: None. This article is originally published at Insider Monkey.
