Critical Review: Karat Packaging (NASDAQ:KRT) and SIG Group (OTC:SIGCY)

SIG Group (OTC:SIGCY) and Karat Packaging (NASDAQ:KRT) are both consumer cyclical companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, earnings, profitability, valuation, analyst recommendations, institutional ownership and risk.

Profitability

This table compares SIG Group and Karat Packaging’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SIG Group	N/A	N/A	N/A
Karat Packaging	8.00%	22.54%	13.21%

Valuation and Earnings

This table compares SIG Group and Karat Packaging’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SIG Group	N/A	N/A	N/A	N/A	N/A
Karat Packaging	$405.65 million	1.30	$32.47 million	$1.62	16.26

Karat Packaging has higher revenue and earnings than SIG Group.

Institutional & Insider Ownership

25.2% of Karat Packaging shares are owned by institutional investors. 71.5% of Karat Packaging shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for SIG Group and Karat Packaging, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SIG Group	0	0	0	0	N/A
Karat Packaging	0	0	3	0	3.00

Karat Packaging has a consensus target price of $30.33, suggesting a potential upside of 15.16%. Given Karat Packaging’s higher possible upside, analysts plainly believe Karat Packaging is more favorable than SIG Group.

Summary

Karat Packaging beats SIG Group on 8 of the 8 factors compared between the two stocks.

About SIG Group

SIG Group AG provides aseptic carton packaging systems and solutions for beverage and liquid food products. The company provides aseptic carton filling lines, aseptic carton sleeves and closures, bag-in-box, and spouted pouch, as well as spare parts, maintenance, digital, add-on, training, and other services. It primarily operates in Europe, the Middle East, Africa, the Asia Pacific, and the Americas. The company was formerly known as SIG Combibloc Group AG and changed its name to SIG Group AG in April 2022. The company was founded in 1853 and is headquartered in Neuhausen am Rheinfall, Switzerland.

About Karat Packaging

Karat Packaging Inc., together with its subsidiaries, engages in the manufacture and distribution of single-use disposable products in plastic, paper, biopolymer-based, and other compostable forms used in various restaurant and foodservice settings. It provides food and take-out containers, bags, tableware, cups, lids, cutlery, straws, specialty beverage ingredients, equipment, gloves, and other products under the Karat Earth brand. The company also provides new product development, design, printing, and logistics services. It offers its products to national and regional distributors, restaurant chains, retail establishments, and online customers. The company was founded in 2000 and is based in Chino, California.