Market Overview

Analyst Drops Bearish Ball Corp. Thesis After EPS, Sales Beat

Analyst Drops Bearish Ball Corp. Thesis After EPS, Sales Beat
Related BLL
Benzinga's Top Upgrades, Downgrades For January 17, 2019
A Peek Into The Markets: US Stock Futures Rise As Investors Await Earnings
Ball Corp. the top stock in paper and packaging, Morgan Stanley says (Seeking Alpha)

Ball Corporation (NYSE: BLL) reported fourth quarter results Feb. 7 with a top-and-bottom-line beat.

The Analyst

KeyBanc Capital Markets' Adam Josephson upgraded Ball's stock rating from Underweight to Sector Weight with no assigned price target.

The Thesis

Ball's Q4 earnings report was "impressive," with "exceptionally good" performance in South America and "good performance" in Europe, Josephson said in the upgrade note.

The results also signaled challenging fundamentals in certain cases — for example, the U.S. beverage and food can segment declined and competition in Brazil will remain heightened in 2018 and 2019, the analyst said. 

Given a few challenges ahead, KeyBanc is modeling Ball's 2018 adjusted EBITDA at $1.84 billion, which does represent an increase from a prior estimate of $1.75 billion. The figure is also modestly below the company's implied guidance and the consensus estimate of around $1.875 billion.

Ball's stock has fallen 7 percent since Josephson downgraded to Underweight Dec. 8. Following the weakness, the stock is trading at a 10-percent premium to its packaging peers on an EV/EBITDA basis compared to 15 percent at the time of the downgrade and a 17-percent historical premium over the past five years, according to KeyBanc. 

Price Action

Ball Corp. shares were trading up slightly midday Monday at $37.95. 

Related Links:

Ball Corp, Silgan Holdings Downgraded As Industry Concerns Mount

Jim Cramer Advises His Viewers On Align Technology, Kennametal And More

Latest Ratings for BLL

Jan 2019Morgan StanleyInitiates Coverage OnOverweight
Jan 2019CitigroupMaintainsBuyBuy
Nov 2018RBC CapitalMaintainsOutperformOutperform

View More Analyst Ratings for BLL
View the Latest Analyst Ratings

Posted-In: Adam Josephson KeyBanc Capital Markets packagingAnalyst Color Upgrades Analyst Ratings Best of Benzinga


Related Articles (BLL)

View Comments and Join the Discussion!

Latest Ratings

EMNMorgan StanleyUpgrades90.0
DERMRaymond JamesUpgrades0.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

Molina Healthcare Earnings Preview

Earnings Outlook For FMC