Ardagh Metal Packaging Sees Potential 57.72% Upside, Despite Decreased Institutional Investments

Wells Fargo (NYSE:WFC) has maintained an Equal-Weight recommendation for Ardagh Metal Packaging (NYSE:PKG) (NYSE: AMBP), a global supplier of recyclable metal beverage cans, on Thursday, October 19, 2023. The financial services firm’s one-year price target for Ardagh averages at $4.37, suggesting a substantial upside of 57.72% from its latest closing price of $2.77.

According to InvestingPro data, Ardagh’s market capitalization stands at a robust $216.92M, with a Price/Earnings ratio of 1.25 and an adjusted P/E ratio of 1.74 for the last twelve months of 2022. This suggests that the company is trading at a low earnings multiple, which is one of the InvestingPro Tips for identifying potential investment opportunities.

Ardagh’s projected annual revenue is expected to grow by 11.52% to $5,169MM, with a non-GAAP EPS of $0.38. This positive outlook comes despite a decrease in the number of funds or institutions invested in Ardagh. The last quarter saw a decrease of 8.18% in the number of funds invested in Ardagh to 292, and institutional ownership also fell by 7.54% to 112,345K shares.

InvestingPro’s real-time metrics reveal that Ardagh’s revenue for the last twelve months of 2022 was $174.89M, with a gross profit of the same amount, indicating a gross profit margin of 100%. The company’s operating income, adjusted for the same period, was $135.21M, resulting in an operating income margin of 77.31%.

The average portfolio weight for AMBP rose by 4.95%, and a bullish put/call ratio of 0.22 indicates market optimism. Canyon Capital Advisors and Newtyn Management retained their respective ownership stakes of 1.70% and 1.17%. Massachusetts Financial Services slightly increased its holdings but decreased its AMBP portfolio allocation by 10.68%.

Two firms, Platinum Equity and Private Management Group, significantly increased their stakes and allocations in Ardagh, reflecting confidence in the company’s potential. It’s worth noting that Ardagh is also trading near its 52-week low, which could be a buying opportunity for investors, according to InvestingPro Tips.

Ardagh operates across nine countries with 23 production facilities and employs around 5,000 individuals. This broad operational base positions the company well for future growth. The company’s return on assets for the last twelve months of 2022 was 16.8%, indicating a high return on assets, another positive sign from the InvestingPro Tips.

For more insights, readers can explore InvestingPro’s additional tips by visiting https://www.investing.com/pro/AMTD.