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Berry Global (BERY) Prices $400M Senior Notes in Private Offering
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Berry Global Group, Inc. (BERY - Free Report) recently announced the pricing of $400 million principal amount of first priority senior secured notes due 2027 in a private placement. Notably, the sale of the notes is expected to close on or about Jun 14, 2021 by the company’s wholly owned subsidiary, Berry Global, Inc.
The company’s shares lost 0.7% yesterday, ending the trading session at $66.69.
Inside the Headlines
The notes will be offered to qualified institutional buyers only and in accordance with Rule 144A under the Securities Act of 1933, as amended and to non-U.S. investors conforming to Regulation S. Interest on the senior notes have been set at 1.65% and will be paid out semi-annually — in cash in arrears — on Jan 15 and Jul 15 of every year. The first interest payment will be made on Jan 15, 2022, while the maturity of the notes will occur on Jan 15, 2027.
The company expects the net proceeds from this offering to be used for prepaying part of certain term loans. The remaining net proceeds will be used for meeting certain fees and expenses associated with the offering.
We believe that the offerings of senior notes will increase the company’s debts and in turn, might inflate its financial obligations and hurt profitability. However, prepaying part of certain term loans will offer some relief. Exiting second-quarter fiscal 2021 (ended Apr 3, 2021), its current and long-term debt remained high at $9,882 million.
Zacks Rank, Price Performance and Earnings Trend
The company, with $9-billion market capitalization, currently carries a Zacks Rank #2 (Buy). It is likely to benefit from its growth opportunities in the plastic and recycled packaging industry, acquired assets and focus on improving operational productivity.
Berry Global’s shares have gained 10.6% compared with 5% growth recorded by the industry in the past three months.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for third-quarter fiscal 2021 (ending June 2021) earnings has increased 0.7% to $1.50 in the past 30 days. Also, estimates for fiscal 2021 (ending September 2021) have increased 0.5% to $5.68 during the same period.
Barnes pulled off a trailing four-quarter earnings surprise of 19.45%, on average.
Dover came up with a trailing four-quarter earnings surprise of 21.35%, on average.
Graco delivered a trailing four-quarter earnings surprise of 28.28%, on average.
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Image: Bigstock
Berry Global (BERY) Prices $400M Senior Notes in Private Offering
Berry Global Group, Inc. (BERY - Free Report) recently announced the pricing of $400 million principal amount of first priority senior secured notes due 2027 in a private placement. Notably, the sale of the notes is expected to close on or about Jun 14, 2021 by the company’s wholly owned subsidiary, Berry Global, Inc.
The company’s shares lost 0.7% yesterday, ending the trading session at $66.69.
Inside the Headlines
The notes will be offered to qualified institutional buyers only and in accordance with Rule 144A under the Securities Act of 1933, as amended and to non-U.S. investors conforming to Regulation S. Interest on the senior notes have been set at 1.65% and will be paid out semi-annually — in cash in arrears — on Jan 15 and Jul 15 of every year. The first interest payment will be made on Jan 15, 2022, while the maturity of the notes will occur on Jan 15, 2027.
The company expects the net proceeds from this offering to be used for prepaying part of certain term loans. The remaining net proceeds will be used for meeting certain fees and expenses associated with the offering.
We believe that the offerings of senior notes will increase the company’s debts and in turn, might inflate its financial obligations and hurt profitability. However, prepaying part of certain term loans will offer some relief. Exiting second-quarter fiscal 2021 (ended Apr 3, 2021), its current and long-term debt remained high at $9,882 million.
Zacks Rank, Price Performance and Earnings Trend
The company, with $9-billion market capitalization, currently carries a Zacks Rank #2 (Buy). It is likely to benefit from its growth opportunities in the plastic and recycled packaging industry, acquired assets and focus on improving operational productivity.
Berry Global’s shares have gained 10.6% compared with 5% growth recorded by the industry in the past three months.
The Zacks Consensus Estimate for third-quarter fiscal 2021 (ending June 2021) earnings has increased 0.7% to $1.50 in the past 30 days. Also, estimates for fiscal 2021 (ending September 2021) have increased 0.5% to $5.68 during the same period.
Other Stocks to Consider
Some other top-ranked stocks from the Zacks Industrial Products sector are Barnes Group, Inc. (B - Free Report) , Dover Corporation (DOV - Free Report) and Graco Inc. (GGG - Free Report) , each currently carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Barnes pulled off a trailing four-quarter earnings surprise of 19.45%, on average.
Dover came up with a trailing four-quarter earnings surprise of 21.35%, on average.
Graco delivered a trailing four-quarter earnings surprise of 28.28%, on average.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
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