Analyst Stephen Macleod from BMO Capital maintained a Hold rating on Winpak and decreased the price target to C$47.00 from C$52.00.
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Stephen Macleod has given his Hold rating due to a combination of factors impacting Winpak’s performance. The company reported a decline in Q2/25 volumes, which were significantly below expectations, primarily due to weak customer demand in rigid packaging and flexible lidding. Although there is an anticipated improvement in volume growth in the latter half of 2025, consumer challenges are expected to persist, leading to a cautious outlook.
Moreover, Winpak’s Q2/25 EBITDA and revenue figures fell short of consensus estimates, with a noticeable drop in gross margins and higher SG&A expenses than forecasted. Despite the company’s strong balance sheet and free cash flow generation, the lack of a clear catalyst for significant growth and the current valuation of the stock led to the decision to maintain a Hold rating, reflecting a belief that the stock is fairly valued given the current market conditions.