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Bank of America Merrill Lynch Upgraded Crown Holdings to ‘Buy’

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Oct. 11 2020, Updated 11:34 a.m. ET

Price movement of Crown Holdings

Crown Holdings (CCK) has a market cap of $6.4 billion. CCK rose by 0.69% to close at $45.56 per share as of February 19, 2016. The price movements on weekly, monthly, and year-to-date (or YTD) bases were 2.2%, 0.69%, and -10.1%, respectively.

At times, the stock has broken the support of all moving day averages. Currently, CCK is trading 0.36% above its 20-day moving average, 4.1% below its 50-day moving average, and 10.5% below its 200-day moving average.

The Guggenheim Mid-Cap Core ETF (CZA) invests 1.0% of its holdings in Crown. The ETF tracks the Zacks Mid-Cap Core Index, a proprietary selected portfolio of 100 mid-cap stocks that seeks to outperform pure market-cap indexes.

The Vanguard Materials ETF (VAW) invests 0.98% of its holdings in Crown. The ETF tracks a very broad market-cap-weighted index of US materials companies. The YTD price movement of VAW is -6.0% as of February 18, 2016.

The market caps of Crown Holdings’ competitors are as follows:

  • Ball Corporation (BLL) — $9.4 billion
  • Silgan Holdings (SLGN) — $3.1 billion
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Bank of America Merrill Lynch upgraded Crown Holdings

Bank of American Merrill Lynch has upgraded Crown Holdings’ rating from “neutral” to “buy” and set the price target at $57 per share.

Performance of Crown Holdings in fiscal 4Q15 and fiscal 2015

Crown Holdings reported 4Q15 net sales of $2,027.0 million, a fall of 4.7% compared to net sales of $2,127.0 million in fiscal 4Q14. Net sales of Americas beverage rose by 11.1%, and net sales of North America food, European beverage, European food, and Asia Pacific fell by 17.1%, 5.4%, 12.9%, and 6.6%, respectively, in fiscal 4Q15 compared to fiscal 4Q14.

Its net income and EPS (earnings per share) rose to $66.0 million and $0.47, respectively, in fiscal 4Q15, compared to $13.0 million and $0.09, respectively, in fiscal 4Q14.

Fiscal 2015 results

In fiscal 2015, CCK reported net sales of $8,762.0 million, a fall of 3.7% YoY (year-over-year). The company’s cost of products sold as a percentage of net sales fell by 2.4%, and its operating income rose by 14.4% in fiscal 2015.

Its net income and EPS rose to $393.0 million and $2.82, respectively, in fiscal 2015, compared to $387.0 million and $2.79, respectively, in fiscal 2014.

Its cash and cash equivalents and inventories fell by 25.7% and 8.4%, respectively, in fiscal 2015. Its current ratio and long-term debt-to-equity ratio fell to 1.0 and 12.1, respectively, in fiscal 2015, compared to 1.2 and 12.8, respectively, in fiscal 2014.

The PE (price-to-earnings) and PS (price-to-sales) ratios of Crown Holdings are 16.2x and 0.73x, respectively, as of February 19, 2016.

In the next part, we’ll look at Flowers Foods.

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