UPDATE: WedbusH Initiates Greif with Neutral, $46 PO on Fair Relative Value

Wedbush initiated its coverage on Greif GEF with a Neutral rating and a price objective of $46 a share. Wedbush commented, "GEF is a very good company but one that is not inexpensive relative to other companies in our coverage, especially when it comes to free cash flow (FCF) metrics. GEF has definitely improved its FCF in recent quarters, but more needs to be done. … Our $46 PO is based on (1) a 12-13x calendarized 2013 P/E multiple; (2) a 7-7.5x calendarized 2013 EV/EBITDA multiple; (3) a normalized FCF estimate of $250-300mn, an estimated 13% cost of equity and forecasted 2% rate of growth." Greif closed at $41.94 on Monday.