In a report released yesterday, Lars Kjellberg from Stifel Nicolaus maintained a Buy rating on Smurfit Westrock (SW – Research Report), with a price target of $67.00.
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Lars Kjellberg has given his Buy rating due to a combination of factors that highlight Smurfit Westrock’s potential for growth and profitability. Despite recent challenges, the company’s Q4 adjusted EBITDA saw a 14% increase year-over-year, which aligns with their guidance. While sales growth was modest and below consensus expectations, the expansion in margins indicates strong operational improvements, creating a strategic buying opportunity after a recent stock price drop.
Moreover, the company is making significant strides in improving margins, particularly in the wake of its merger, without sacrificing market share in crucial regions like the US and Brazil. Management has reinforced its confidence in realizing $400 million in synergies by the end of 2025, with additional gains expected from strategic pricing and capital projects. This focus on long-term integration and performance enhancement, alongside conservative guidance and expected improvements in demand and pricing, supports the Buy rating and the $67 price target.
Kjellberg covers the Consumer Cyclical sector, focusing on stocks such as International Paper Co, Avery Dennison, and Graphic Packaging. According to TipRanks, Kjellberg has an average return of 9.2% and a 57.04% success rate on recommended stocks.
In another report released yesterday, RBC Capital also reiterated a Buy rating on the stock with a $61.00 price target.