Polypropylene and PET resin pricing: 40-50% of COGS tied to petroleum-based inputs, with 60-90 day lag in passing through cost changes
Foodservice traffic and restaurant same-store sales: direct correlation to disposable product consumption volumes
Food delivery platform growth (DoorDash, UberEats): high-margin channel driving incremental demand for takeout containers
Gross margin trajectory: ability to maintain 38-40% range amid raw material volatility signals pricing discipline
moderate-to-high - Revenue correlates strongly with restaurant industry health and consumer discretionary spending on dining out. During recessions, restaurant traffic declines 5-15%, directly reducing disposable product volumes. However, the shift toward takeout/delivery provides some offset, as off-premise dining requires more packaging per transaction. The company benefits from secular growth in food delivery (10%+ annually) but remains exposed to overall foodservice industry cycles. Small/independent restaurants (30-40% of customer base) are particularly vulnerable during economic downturns.
Rising rates have modest negative impact through two channels: (1) higher working capital financing costs for inventory and receivables (estimated $50-80M in revolving credit usage), adding 50-100bps to operating costs per 100bps rate increase, and (2) pressure on restaurant customers' expansion plans and profitability, potentially slowing new account growth. However, the company's 2.14x current ratio and moderate 0.60x debt/equity ratio limit direct financial stress. Valuation multiples compress as investors rotate from growth to value during rate hiking cycles.
Single-use plastics regulation: Growing municipal and state-level bans on disposable foodservice items (California, New York, Seattle) could reduce addressable market by 10-20% over 5-10 years, though company's sustainable product focus provides partial hedge
Vertical integration by large customers: Major QSR chains (McDonald's, Starbucks) may negotiate direct with Asian manufacturers, bypassing distributors and compressing margins on commodity products
E-commerce disintermediation: Amazon Business and direct-from-manufacturer platforms enabling smaller restaurants to source products without traditional distributors
value - The stock trades at 1.1x sales and 9.2x EV/EBITDA, below packaging industry medians, attracting value investors seeking recovery plays on foodservice normalization. The 8.5% FCF yield appeals to cash flow-focused investors. Recent 21.6% three-month rally suggests momentum traders entering on improving fundamentals, but -22.8% one-year return indicates prior pessimism. Small-cap status ($500M market cap) limits institutional ownership but attracts opportunistic hedge funds and microcap specialists. The 19.6% ROE and strong balance sheet (2.14x current ratio) support value thesis despite modest 4.2% revenue growth.
Trend
+9.4% vs SMA 50 · +5.7% vs SMA 200
Momentum
Volume distribution is neutral or leaning toward distribution. No compelling squeeze setup based on current money flow data.
Based on volume distribution analysis. Direct short interest data (short float %, days to cover) is not available in current data sources.
ANALYST ESTIMATES
Analyst consensus estimates · Actuals replace estimates as reported
| Year | Revenue Est. | Rev Gth | EPS Est. | EPS Gth | Range | Analysts |
|---|---|---|---|---|---|---|
FY2023 | $409.3M $405.3M–$413.4M | — | $1.41 | — | ±1% | Low2 |
FY2024 | $423.3M $422.8M–$424.0M | ▲ +3.4% | $1.71 | ▲ +20.8% | ±1% | Moderate3 |
FY2025 | $466.0M $461.5M–$470.7M | ▲ +10.1% | $1.51 | ▼ -11.5% | ±1% | Low2 |
Dividend per payment — last 8 periods
INSTITUTIONAL OWNERSHIP
KRT News
About
lollicup usa domestically manufactures & distributes karat® paper & plastic disposable foodservice products, and tea zone® coffee & beverage supplies for thousands of retail business accounts, including several fortune 500 restaurant franchises. founded in 2000 by alan yu and marvin cheng, lollicup usa began with the opening of our first bubble tea café in san gabriel, ca, bringing the popular taiwanese boba milk tea to the u.s. market. by 2004, over 60 stores were opened across six states. with two new locations in chengdu, china, we are currently updating our existing locations and plan on opening additional stores in the near future, expanding overseas into europe and the middle east. to maintain consistent quality for our retail stores, lollicup usa established two brands, tea zone® and karat®, in 2001 and 2004 respectively. tea zone™ offers high-quality bubble tea & beverage ingredients, while karat® provides premium paper & plastic disposable goods. while expanding our company, w
| Symbol | Price | Day % | Mkt Cap↓ | P/E | Rev Grw | Margin | ELO |
|---|---|---|---|---|---|---|---|
KRT◀ | $26.77 | +2.02% | $534M | — | +1067.4% | 673.0% | 1500 |
| $888.31 | +0.00% | $409.2B | — | — | — | 1526 | |
| $281.53 | -3.43% | $294.2B | — | — | — | 1488 | |
| $171.18 | +0.00% | $230.5B | — | — | — | 1486 | |
| $220.49 | +0.00% | $173.8B | — | — | — | 1502 | |
| $270.56 | +0.45% | $160.6B | 22.2 | +107.2% | 2912.3% | 1506 | |
| $399.44 | +0.00% | $155.1B | — | — | — | 1506 | |
| Sector avg | — | -0.14% | — | 22.2 | +587.3% | 1792.6% | 1502 |