O-I Glass stock rating reiterated at Outperform by RBC on turnaround plan

RBC Capital has reiterated an Outperform rating on O-I Glass Inc. (NYSE:OI) with a price target of $16.00, above the current trading price of $13.71. According to InvestingPro data, analyst targets range from $13 to $20, with the stock currently trading near its 52-week high. The firm maintained its positive outlook following investor meetings with O-I Glass Chief Financial Officer John Haudrich and Investor Relations representative Chris Manuel in Boston.

The glass container manufacturer is executing on its "Fit-to-Win" turnaround strategy, which RBC notes is still in its early stages, representing year one of a three-to-five-year plan. The strategy appears to be gaining traction, with InvestingPro data showing a significant 31% stock price increase over the past six months. RBC Capital believes this initiative could potentially drive results toward the upper end of the company’s guidance.

Despite acknowledging that demand remains choppy and subject to inflation impacts on consumers, RBC indicated that O-I Glass is performing at or above expectations in key areas including volumes and price/cost metrics. The company maintains a solid liquidity position with a current ratio of 1.24, though it carries a notable debt-to-equity ratio of 4.5. Get access to 8 more key financial insights and a comprehensive Pro Research Report with InvestingPro.

The firm highlighted that successful execution of the turnaround plan could lead to accelerated free cash flow generation and debt reduction for O-I Glass. RBC specifically noted these improvements could ultimately result in multiple expansion for the stock.

The company’s management is reportedly working to drive results toward the upper range of its guidance, which would support RBC’s thesis for maintaining the Outperform rating and $16.00 price target.

In other recent news, O-I Glass Inc. reported better-than-expected financial results for the first quarter of 2025. The company achieved earnings per share of $0.40, surpassing the projected $0.23, and reported revenue of $1.6 billion, exceeding the anticipated $1.55 billion. O-I Glass also announced the approval of its Fifth Amended and Restated 2017 Incentive Award Plan, increasing share allocation for awards to 33.6 million shares. Bank of America Securities raised its price target for O-I Glass to $15 from $13, maintaining a Buy rating, citing confidence in the company’s valuation and strategic initiatives. The company’s Fit to Win program contributed $61 million in savings, and management reaffirmed its 2025 guidance amid broader sluggish consumer trends. Shareholders ratified the appointment of Ernst & Young LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025. These developments reflect O-I Glass’s strategic efforts to enhance performance and shareholder value.

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