Smurfit Westrock: North American Strategic Reset and European Resilience Create Asymmetric Buy Opportunity

Smurfit Westrock, the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Ioannis Masvoulas from Morgan Stanley maintained a Buy rating on the stock and has a $53.00 price target.

Ioannis Masvoulas has given his Buy rating due to a combination of factors that, in his view, position Smurfit Westrock for attractive risk‑reward. He highlights the company’s strategic overhaul in North America, where it is moving away from a volume-driven model toward a value-focused approach, shedding unprofitable contracts and tightening operational accountability at the plant level. This reset is expected to coincide with an industry-wide capacity reduction that should lift containerboard operating rates, supporting better pricing and profitability as US volumes begin to recover from the second half of 2026. At the same time, he notes that North America is set to represent the majority of group EBITDA, so these structural improvements have a meaningful impact on the overall investment case.
In Europe, Masvoulas points out that Smurfit Westrock benefits from market leadership and a fully integrated paper and box network, which helps sustain margins even in a weaker industry utilization environment, suggesting earnings in the region are near a cyclical trough with upside potential. He also views the upcoming strategy update as a near-term catalyst, expecting more detail on disciplined capital allocation, portfolio optimization in US paperboard and containerboard, and long-term margin ambitions, all of which could support a re-rating. Finally, he emphasizes that the stock trades at a notable discount to both its own historical valuation and to peers despite below mid-cycle earnings, implying asymmetric upside if the North American reset, tight supply backdrop, and resilient European operations are reflected more fully in the share price. The main risk he flags is the possibility of a more prolonged US demand slowdown that could delay the expected volume recovery beyond 2026, but he judges the current valuation as more than compensating for this uncertainty.

According to TipRanks, Masvoulas is a 4-star analyst with an average return of 6.9% and a 61.88% success rate. Masvoulas covers the Basic Materials sector, focusing on stocks such as Lundin Mining, Antofagasta, and Stora Enso Oyj.

In another report released yesterday, Citi also maintained a Buy rating on the stock with a $48.00 price target.