- Truist Securities analyst Michael Roxland initiated coverage on Ardagh Metal Packaging SA AMBP at a Hold rating with a price target of $4.
- The analyst is bullish on AMBP's position as the only public pure-play beverage can producer and its growing exposure to higher-margin speciality mix business.
- Roxland sees growth opportunities for the company given its improving execution, and promising beverage can supply/demand dynamics.
- However, the analyst sees a comparatively concentrated customer base, challenging dividend coverage and declining hard seltzer demand as a matter of concern.
- Also, Roxland believes AMBP's aggressive expansion initiative in Europe and North America has led to project rephasing and weaker fixed cost absorption driving leverage, which can act as a headwind.
- The analyst expects EPS of $0.25 (consensus: $0.26) for 2023, revenues of $5.15 billion and EPS of $0.30 (consensus: $0.34) for 2024.
- Price Action: AMBP shares are trading lower by 2.37% at $3.51 on last check Tuesday.
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