WestRock (WRK – Research Report), the Basic Materials sector company, was revisited by a Wall Street analyst on November 10. Analyst Gabrial Hajde from Wells Fargo remains neutral on the stock and has a $42.00 price target.
Gabrial Hajde based his Buy rating on WestRock’s stock on a combination of factors which he believes skews the risk/reward favorably. The main factors highlighted include WestRock’s portfolio optimization and cost-cutting actions which he predicts will drive improved margins and reduce earnings volatility in the medium term. Despite the expectation of lower prices and higher costs in 2024, Hajde is optimistic that productivity gains and higher volumes will partially offset these.
Additionally, he pointed out that WestRock continues to execute on its productivity actions, which are effectively offsetting pricing pressure and softer volumes. The company’s Corrugated and Consumer Packaging sectors are showing promising signs with expectations for volume recovery and ongoing progress. Despite current softness in certain segments, there are anticipations for volume growth as order rates normalize. Furthermore, WestRock is targeting significant cost savings. These factors combined led Hajde to maintain his Buy rating and a $42 price target.
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WestRock (WRK) Company Description:
WestRock Co. engages in the provision of paper and packaging solutions for consumer, and corrugated packaging markets. It operates through the following segments: Corrugated Packaging, Consumer Packaging and Land & Development. The Corrugated Packaging segment consists of containerboard mill and corrugated packaging operations, as well as recycling operations. The Consumer Packaging segment offers consumer mills, folding carton, beverage, merchandising displays, home, health, and beauty dispensing, and partition operations. The Land and Development segment sells real estate. WestRock was founded on March 6, 2015 and is headquartered in Atlanta, GA.
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