In a report released today, Joshua Spector from UBS upgraded Sealed Air (SEE – Research Report) to a Buy, with a price target of $38.00.
Joshua Spector has given his Buy rating due to a combination of factors influencing Sealed Air’s current market position. Despite a 30% decline in stock value since mid-January, Spector sees this as a buying opportunity, noting that much of the negative risk is already reflected in the current price. The company’s Protective segment has faced challenges, but management anticipates a turnaround in the latter half of the year. Although Spector remains cautious about potential volume declines due to weaker freight and goods demand, he acknowledges the company’s $90 million cost-saving initiatives targeted for 2025, which could mitigate some of these challenges.
Furthermore, Sealed Air’s Food segment, which contributes approximately 75% of its EBITDA, has shown stability and consistent growth. While there are concerns about US meat exports and consumer demand, the company’s diverse portfolio, including exposure to Latin American and Australian markets, provides some balance. Spector’s valuation reflects a potential upside, with a price target of $38, indicating a 55% increase from current levels. The expectation of earnings stabilization in 2025, combined with cost-cutting measures and a favorable free cash flow yield, supports the Buy recommendation.
According to TipRanks, Spector is an analyst with an average return of -1.0% and a 47.90% success rate. Spector covers the Basic Materials sector, focusing on stocks such as Air Products and Chemicals, Albemarle, and Celanese.