Ghansham Panjabi, an analyst from Robert W. Baird, maintained the Hold rating on Amcor (AMCR – Research Report). The associated price target is $10.00.
Ghansham Panjabi has given his Hold rating due to a combination of factors. Amcor’s volumes continue to be affected by end-market weakness and inventory destocking, despite the company’s efforts to deliver an improved earnings trajectory. This persistent volume weakness is seen across its operating segments, Flexibles and Rigids, and is pronounced in regions such as North America, Europe, and Latin America. The company is also dealing with the loss of Russian assets, which impacts its earnings.
On the positive side, Amcor is on track with cost savings, which could lead to an increase in EPS in the second half of FY24. The company is expected to benefit from these cost-out savings as part of its structural cost reduction program. Furthermore, the company’s push into higher-margin product categories has been beneficial in buffering margins. However, Panjabi believes that earnings are unlikely to improve significantly until 4FQ24, hence his Neutral rating on the shares. His lowered $10 price target is based on around 14x his FY24 EPS estimate of $0.69.
According to TipRanks, Panjabi is a 4-star analyst with an average return of 5.2% and a 55.98% success rate. Panjabi covers the Industrials sector, focusing on stocks such as Greif Class A, AptarGroup, and Avery Dennison.
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Amcor (AMCR) Company Description:
Amcor Plc operates as a holding company, which engages in the provision of consumer packaging business. It operates through the Flexibles and Rigid Packaging segments. The Flexibles segment develops and supplies flexible packaging globally. The Rigid Plastics segment manufactures rigid plastic containers and related products. The company was founded on July 31, 2018 and is headquartered in Warmley, the United Kingdom.
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