Silgan Holdings downgraded to Sector Perform from Outperform at RBC Capital

RBC Capital analyst Arun Viswanathan downgraded Silgan Holdings (SLGN) to Sector Perform from Outperform with a price target of $43, down from $49. The company’s DSC segment – Dispensing and Specialty Closures – could be experiencing structural weakness, which was 52% of FY24 revenue, the analyst tells investors in a research note. Silgan faces bifurcated North America customer activity, where higher income consumers are increasing spending on high-growth luxury products, while lower income consumers battered with inflation and slow wage growth are cutting spending, the firm added. Structural DSC issues, potential continued customer volatility, and weak plastic packaging organic growth provide substantial challenges for the stock, RBC stated.