Sealed Air shares target reduced by Mizuho amid mixed volume outlook

Published 18/07/2024, 12:32
Sealed Air shares target reduced by Mizuho amid mixed volume outlook

On Thursday, Mizuho made adjustments to its financial outlook for Sealed Air Corporation (NYSE:SEE) shares, reducing the price target on the company to $47 from $50. The firm maintained its Outperform rating on the stock despite the price target change.

The adjustment comes as Mizuho forecasts Sealed Air to report second-quarter earnings before interest, taxes, depreciation, and amortization (EBITDA) and earnings per share (EPS) of $262 million and $0.66, respectively. These figures are in line with the Bloomberg consensus of $263 million EBITDA and $0.64 EPS.

Mizuho's analysis suggests that Sealed Air's Food Care segment is expected to show steady volume, following a 2.9% year-over-year volume increase in the first quarter of 2024.

This projection breaks a trend of seven consecutive quarters of year-over-year volume declines prior to the first quarter of 2024. The firm anticipates that Sealed Air will experience sustained volume growth in the second half of 2024 and into 2025.

The Protective Care volumes, on the other hand, have faced more challenges. However, Mizuho predicts a positive volume inflection in the fourth quarter of 2024, extending into 2025, due to easier comparative figures from the previous year and a modest uptick in demand.

Mizuho has not altered its earnings estimates for Sealed Air but has revised the price target to reflect a multiple of 9 times the forward next twelve months plus one quarter (NTM+1) estimated EBITDA of $1.18 billion. The new price target suggests a 31% upside from the current level of the stock.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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