Amcor Gains As Wall Street Upgrades Stock On $8.43B Berry Global Deal: Retail In Wait-And-Watch Mode
By Stocktwits Inc | First Published Jan 6, 2025, 7:33 PM ISTThe acquisition of Berry Global positions Amcor as a leader in the packaging industry, with analysts optimistic about cost synergies and recovery trends.
Shares of Amcor Plc. (AMCR) rose 2.5% in pre-market trading on Monday following a series of Wall Street upgrades tied to its acquisition of U.S.-based Berry Global.
The $8.43 billion all-stock deal, announced in early November, creates a packaging powerhouse with combined annual revenues of $24 billion, spanning both consumer and healthcare sectors.
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Analysts broadly agree that the deal’s synergies, coupled with Amcor’s volume recovery and operational stability, could boost the company’s market presence.
Citi upgraded Amcor to ‘Buy’ from ‘Neutral,’ raising its price target to $12 from $11.
The brokerage believes the cost synergies from the Berry acquisition will be "relatively easy to achieve."
Amcor and Berry make cartons, closures, and containers for the food, beverage, pharmaceutical, medical, home, and personal-care industries. Combined, they will have a footprint in more than 140 countries.
Citi also highlighted that the stock is oversold following a December selloff and pointed to the potential for sustained volume recovery in flexible packaging and stability in rigid packaging.
Truist also raised its rating on Amcor to ‘Buy’ from ‘Hold,’ lifting its price target to $12 from $10, citing an "attractive setup" following the transformational Berry deal.
The brokerage expects packaging volumes to remain challenged in early 2025 due to modest promotional activity but is optimistic about longer-term benefits.
According to Stocktwits data, Amcor has seen a 200% increase in message volume over the last year, along with a 12% jump in watchers.
The Berry Global deal is by far Amcor's largest acquisition to date. It is expected to close in the middle of 2025.
In 2019, it bought U.S. rival Bemis in a $5.25 billion all-stock deal but had to divest three manufacturing facilities to gain approval from the U.S. Justice Department.
The bullish calls on Amcor’s future outlook provide some respite for investors, given the stock lost 4.8% of its value last year.
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