Karat Packaging Inc (KRT) Stock Analysis
Verdict: WATCH (do not buy)
Ocean freight cost spikes severely compressed Q3 gross margins to 33.5%, creating a valuation discount counterbalanced by high FCF yield.
Investment score: 51/100
Analysis as of
Is Karat Packaging Inc stock worth reviewing? The TradeMates thesis
The TradeMates model sees Karat Packaging as a Watch opportunity. The stock offers attractive fundamental valuation multiples (P/E 14.90x, EV/EBITDA 8.67x) and low balance sheet leverage, but recent margin contraction to 33.5% and a -47.3% Q3 earnings surprise require stabilization before committing capital.
7-factor investment score
- Valuation: 68/100 (weight 20%)
- Financial Health: 72/100 (weight 15%)
- Technical Momentum: 32/100 (weight 15%)
- Earnings Quality: 35/100 (weight 15%)
- Insider Sentiment: 38/100 (weight 10%)
- Analyst Consensus: 55/100 (weight 10%)
- Risk-Adjusted Return: 50/100 (weight 15%)
Karat Packaging Inc opportunities and risks
What speaks for KRT
- E-Commerce Channel Acceleration
What speaks against KRT
- Ocean Freight Spikes Compress Gross Margins
Peers and competitors
| Ticker | P/E | P/S | EV/EBITDA | Gross margin | Net margin | FCF yield |
|---|---|---|---|---|---|---|
| KRT | 14.9x | 1.4x | 8.7x | 40.1% | 9.4% | 8.7% |
| DSGR | 147.0x | 0.8x | 16.0x | 32.5% | 0.5% | 0.9% |
| TRNS | 217.0x | 2.8x | 28.1x | 32.8% | 1.3% | 2.3% |
| WLFC | 19.3x | 1.2x | 12.0x | 36.1% | 9.6% | -76.9% |
| NPKI | 20.1x | 2.5x | 9.5x | 35.2% | 12.7% | 1.4% |
| TITN | n/a | 0.2x | 44.5x | 16.5% | -2.5% | 9.0% |
| Peer median | 20.1x | 1.2x | 16.0x | 32.8% | 1.3% | 1.4% |
Frequently asked questions about Karat Packaging Inc (KRT)
Is KRT stock a good investment?
The TradeMates model rates Karat Packaging Inc as WATCH (do not buy) with an investment score of 51/100. The TradeMates model sees Karat Packaging as a Watch opportunity. The stock offers attractive fundamental valuation multiples (P/E 14.90x, EV/EBITDA 8.67x) and low balance sheet leverage, but recent margin contraction to 33.5% and a -47.3% Q3 earnings surprise require stabilization before committing capital. This is algorithmic model output, not personal investment advice.
Is KRT stock a buy?
The TradeMates model verdict for KRT is WATCH (do not buy) with an investment score of 51/100. Treat this as a model signal to review, not a personal buy recommendation.