This Stock Is Trading at New All-Time Highs and Looks Like a Great Long-Term Winner

• Karat Packaging (KRT) demonstrates strong technical momentum and is trading at a new all-time high.
• Shares are up more than 110% over the past year.
• KRT has projected revenue growth of 12.01% this year and 8.47% next year.
• Analyst sentiment is mixed. The consensus leans “Strong Buy,” but some see the stock as overvalued.

Today’s Featured Stock

Valued at $1 billion, Karat Packaging (KRT) is a specialty distributor and manufacturer of disposable foodservice products and related items. Its products include food and take-out containers, bags, tableware, cups, lids, cutlery, straws, specialty beverage ingredients, equipment, gloves, and other products. The company also offers customized solutions, including new product development and design, printing and logistics services.  

What I’m Watching

I found today’s Chart of the Day by using Barchart’s powerful screening functions to sort for stocks with the highest technical buy signals and superior current momentum. I then used Barchart’s Flipcharts feature to review the charts for consistent price appreciation. KRT checks those boxes. The Trend Seeker issued a new “Buy” signal on June 11. The stock has gained 72.41% since that signal.

Barchart’s Technical Indicators for Karat Packaging

Editor’s Note: The technical indicators below are updated live during the session every 20 minutes and can therefore change each day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com website when you read this report. These technical indicators form the Barchart Opinion on a particular stock.

Karat Packaging an all-time high of $51.88 on Sept. 22.

• Karat has a Weighted Alpha of 138.77.
• KRT has a 100% “Buy” opinion from Barchart.
• The stock has gained 111.58% over the past 52 weeks.
• Karat has its Trend Seeker “Buy” signal intact.
• The stock recently traded at $51.35 with a 50-day moving average of $45.27.
• KRT had 7 highs and gained 6.83% in the last month.
• 60-month beta of 0.84.
• Relative Strength Index (RSI) is at 70.
• There’s a technical support level around $49.57.

Don’t Forget the Fundamentals

• $1 billion market capitalization.
• 20.19x trailing price-earnings ratio.
• Revenue is projected to grow 12.01% this year and another 8.47% next year.
• Earnings are estimated to increase by 68.94% this year but decrease by 14.34% next year.

Analyst and Investor Sentiment on Karat Packaging

• The Wall Street analysts followed by Barchart give the stock 2 “Strong Buy,” 1 “Hold,” and 1 “Moderate Sell” opinions with price targets from $35 to $60.
• Value Line rates the stock “Above Average.”
• Morningstar thinks the stock is 11% overvalued with a fair value of $44.62.
• CFRA’s MarketScope rates the stock as “Hold.”
• 2,380 investors are following the stock on Seeking Alpha, which rates it a “Strong Buy.”
• TipRanks’ analysts’ price target is $47.00.
• Short interest is a very low 1.57% of the float with 2.48 days to cover the float.

The Bottom Line on Karat Packaging

Every time I go out to a restaurant, I notice huge amounts of takeout and DoorDash orders waiting to be picked up. As long as this trend continues, Karat Packaging will be there providing the takeout containers and plasticware. Looks like a great long-term holding.

Additional disclosure: The Barchart Chart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. Should you decide to add one of these stocks to your investment portfolio, it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance. 

On the date of publication, Jim Van Meerten did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.