Silgan Holdings stock rating downgraded to Neutral by BofA Securities

Investing.com - BofA Securities downgraded Silgan Holdings (NYSE:SLGN) from Buy to Neutral on Wednesday, while raising its price target to $59.00 from $57.00. According to InvestingPro data, the stock appears overvalued at current levels, trading at $56.58, near its 52-week high of $58.14.

The downgrade comes as Silgan’s stock has risen approximately 9% this year, bringing it closer to BofA’s price objective and creating what the firm describes as a more balanced risk/reward profile. The company has demonstrated strong financial health with a "GOOD" overall rating from InvestingPro, maintaining dividend payments for 21 consecutive years.

BofA Securities noted that Silgan had previously been one of its favorite Buy recommendations in 2025, but the stock’s recent performance prompted the rating change despite the slightly higher price target.

The investment bank indicated that market participants have already factored in several key elements of Silgan’s growth story, including potential earnings from a partial pack recovery, contributions from the Weener acquisition, and ongoing cost-cutting initiatives.

The firm’s analyst assessment concluded that these positive catalysts are now "well understood in the market," suggesting limited additional upside potential at current price levels.

In other recent news, Silgan Holdings reported its Q1 2025 financial results, revealing an earnings per share (EPS) of $0.69, which fell short of the forecasted $0.79. Revenue, however, aligned with expectations at $1.47 billion. Despite the EPS miss, the company maintains a positive outlook for 2025, with full-year EPS guidance projected between $4.00 and $4.20. Additionally, Silgan achieved a robust year-over-year increase in net sales, reaching $1.5 billion, an 11% rise, driven by strong demand in dispensing products and pet food packaging segments.

In terms of analyst activity, Raymond (NSE:RYMD) James reiterated its Strong Buy rating for Silgan, citing limited impact from Del Monte’s bankruptcy, which represents approximately 2% of Silgan’s revenue. Meanwhile, JPMorgan upgraded Silgan’s stock rating to Overweight, setting a price target of $57.00, and highlighted a strong earnings year anticipated for 2025. The acquisition of Weener in late 2024 is expected to add over $100 million to annual EBITDA and approximately $50 million to EBIT, despite an expected increase in interest expenses. These developments indicate strategic moves by Silgan to bolster its financial performance in the coming year.

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