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Why Ball Corporation Stock Rose on June 28


Jun. 29 2016, Published 5:39 p.m. ET

Price movement: Ball

Ball Corporation (BLL) has a market cap of $10.0 billion. It rose 3.3% to close at $70.60 per share on June 28. The stock’s weekly, monthly, and year-to-date (or YTD) price movements were -1.9%, -2.3%, and -2.6%, respectively, on the same day.

BLL is trading 2.7% below its 20-day moving average, 2.8% below its 50-day moving average, and 2.2% above its 200-day moving average.

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Related ETFs and peers

The Vanguard Mid-Cap ETF (VO) invests 0.28% of its holdings in Ball Corporation. The ETF tracks the CRSP US Mid-Cap Index, a diversified index of midcap US companies. The YTD price movement of VO was 0.04% on June 28, 2016.

The market caps of Ball’s competitors are as follows:

  • Boeing (BA) — $78.9 billion
  • Alcoa (AA) — $12.3 billion
  • Crown Holdings (CCK) — $6.9 billion

FTC approved Ball’s offer

In a press release on June 28, 2016, Ball Corporation stated, “The Federal Trade Commission (or FTC) has formally approved its proposed acquisition of Rexam PLC, and thereby granted final regulatory clearance in the United States for Ball’s offer for Rexam PLC. The FTC has also formally approved Ardagh Group’s proposed acquisition of certain Rexam PLC assets in the US.”

The company also stated, “Upon closing the proposed offer for Rexam PLC, Ball will operate its 16 existing metal beverage packaging manufacturing plants in the US, Canada, and Mexico.”

The company has already received final unconditional regulatory clearance in Brazil and Europe on June 8 and June 17, respectively.

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Performance: Ball Corporation in 1Q16

Ball Corporation reported fiscal 1Q16 net sales of $1,756.0 million, a fall of 8.7% compared to net sales of $1,923.0 million in fiscal 1Q15. Sales of metal beverage packaging in the Americas & Asia, metal beverage packaging in Europe, metal food and household products packaging, and aerospace and technologies fell 8.4%, 6.1%, 7.8%, and 16.3%, respectively, in fiscal 1Q16 from fiscal 1Q15. The company reported business consolidation and other activities expenses of $267.0 million in fiscal 1Q16 compared to $52.0 million in fiscal 1Q15.

Its net income and EPS (earnings per share) fell to -$127.0 million and -$0.90, respectively, in fiscal 1Q16 from $28.0 million and $0.15, respectively, in fiscal 1Q15.

Ball’s cash and cash equivalents and inventories fell 10.5% and 7.5%, respectively, in fiscal 1Q16 compared to fiscal 1Q15. Its current ratio fell to 1.0x and long-term debt-to-equity ratio rose to 5.0x in fiscal 1Q16 compared to a current ratio and long-term debt-to-equity ratio of 1.2x and 2.7x, respectively, in fiscal 1Q15.

Next, we’ll discuss McCormick & Company.


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