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Investing.com - UBS raised its price target on Crown Holdings (NYSE:CCK) to $130.00 from $125.00 on Tuesday, while maintaining a Buy rating following the company’s quarterly earnings beat and raised guidance. The packaging manufacturer, currently trading at $104.75 with a market capitalization of $12.05 billion, appears undervalued according to InvestingPro analysis.
Crown Holdings delivered results that exceeded investor expectations, with the company raising its adjusted EPS guidance by approximately 40 cents above the midpoint, about 10 cents higher than the quarterly beat, according to UBS. InvestingPro data shows the company has maintained strong financial health, with an EBITDA of $1.995 billion in the last twelve months.
Beverage can demand remained strong with volumes increasing in the company’s larger segments including Americas and Europe, while the Transit Packaging (NYSE:PKG) division delivered stable EBIT year-over-year despite weaker industrial shipment demand.
The packaging manufacturer also raised its free cash flow guidance to $900 million from the previous $800 million target, which UBS highlighted as another positive development for the company.
UBS noted that Crown’s share buyback activity was minimal during the quarter compared to the first quarter when it reached approximately $200 million, but the firm expects buybacks to become a larger lever in the future as Crown works toward a net debt to EBITDA ratio of approximately 2.5x versus the current 2.7x on a last twelve months basis.
In other recent news, Crown Holdings Inc. announced its second-quarter financial results, reporting adjusted earnings per share of $2.15. This figure exceeded analyst expectations, which had been set at $1.88 per share. The company also reported revenue of $3.15 billion, surpassing the consensus estimate of $3.11 billion and marking a 3.6% increase from $3.04 billion in the same quarter the previous year. Despite these strong financial results, the company’s shares fell amid investor concerns about potential tariff impacts. Crown Holdings also raised its guidance, indicating optimism about future performance. These developments are part of the company’s ongoing efforts to navigate market challenges. The positive earnings and revenue figures suggest robust operational performance, aligning with the company’s strategic objectives. Analysts and investors will be closely monitoring how Crown Holdings addresses the potential impacts of tariffs in the coming quarters.
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