We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Here's Why You Should Avoid Investing in Berry Global (BERY)
Read MoreHide Full Article
Berry Global Group, Inc. (BERY - Free Report) is struggling with a low demand environment, customer destocking and ongoing inflationary pressure, which are likely to impede the company’s earnings in the quarters ahead.
Let’s discuss the factors that are likely to continue taking a toll on this current Zacks Rank #4 (Sell) company.
Segment Weakness: Berry Global’s Consumer Packaging International segment has been experiencing weakness due to the softer consumer and industrial market. Lower selling prices due to the pass-through of lower resin costs in the United States and reduced demand in the industrial end markets have been affecting the Consumer Packaging North America segment.
The Engineered Materials segment has been experiencing weakness due to lower selling prices from the pass-through of lower resin costs in the United States and volume softness in European industrial markets. Demand softness in air and liquid filtration, building and construction end markets, and lower selling prices due to the pass-through of lower resin costs have been affecting the Health, Hygiene, & Specialties segment.
Increasing Debt Level: Rising debts are worrisome for the company. Berry Global’s long-term debt in the last five fiscal years (2018-2022) witnessed a 9.7% CAGR. Despite its efforts to reduce debt leverage, BERY’s current and long-term debt remained high at $8,980 million at the end of the fourth quarter of fiscal 2023 (ended September 2023).
Forex Woes: Berry Global has a significant presence in the international markets. As a result, its financial performance is subject to various risks like the foreign currency exchange rate, interest rate fluctuations and hyperinflation in some foreign countries. The increased value of the U.S. dollar relative to the local currencies of the foreign markets is affecting the company’s top line. In fiscal 2023, foreign exchange headwinds had an adverse impact of $84 million on its sales.
Southbound Estimate Revisions: In the past 60 days, the Zacks Consensus Estimate for BERY’s fiscal 2024 (ending September 2024) earnings has been revised 4.5% downward.
Price Performance: Shares of the company have declined 0.8% in the past six months against the industry’s 2.2% increase.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked companies from the Industrial Products sector are discussed below:
EPAC delivered a trailing four-quarter average earnings surprise of 21.9%. In the past 60 days, the Zacks Consensus Estimate for Enerpac’s fiscal 2024 earnings has increased 2.3%. The stock has risen 6.9% in the past six months.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 13.9%.
The Zacks Consensus Estimate for AIT’s fiscal 2024 earnings has remained steady in the past 60 days. Shares of Applied Industrial have gained 16.8% in the past six months.
Crane Company (CR - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 29.8%.
In the past 60 days, the Zacks Consensus Estimate for Crane’s 2023 earnings has remained steady. The stock has risen 22.9% in the past six months.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Here's Why You Should Avoid Investing in Berry Global (BERY)
Berry Global Group, Inc. (BERY - Free Report) is struggling with a low demand environment, customer destocking and ongoing inflationary pressure, which are likely to impede the company’s earnings in the quarters ahead.
Let’s discuss the factors that are likely to continue taking a toll on this current Zacks Rank #4 (Sell) company.
Segment Weakness: Berry Global’s Consumer Packaging International segment has been experiencing weakness due to the softer consumer and industrial market. Lower selling prices due to the pass-through of lower resin costs in the United States and reduced demand in the industrial end markets have been affecting the Consumer Packaging North America segment.
The Engineered Materials segment has been experiencing weakness due to lower selling prices from the pass-through of lower resin costs in the United States and volume softness in European industrial markets. Demand softness in air and liquid filtration, building and construction end markets, and lower selling prices due to the pass-through of lower resin costs have been affecting the Health, Hygiene, & Specialties segment.
Increasing Debt Level: Rising debts are worrisome for the company. Berry Global’s long-term debt in the last five fiscal years (2018-2022) witnessed a 9.7% CAGR. Despite its efforts to reduce debt leverage, BERY’s current and long-term debt remained high at $8,980 million at the end of the fourth quarter of fiscal 2023 (ended September 2023).
Forex Woes: Berry Global has a significant presence in the international markets. As a result, its financial performance is subject to various risks like the foreign currency exchange rate, interest rate fluctuations and hyperinflation in some foreign countries. The increased value of the U.S. dollar relative to the local currencies of the foreign markets is affecting the company’s top line. In fiscal 2023, foreign exchange headwinds had an adverse impact of $84 million on its sales.
Southbound Estimate Revisions: In the past 60 days, the Zacks Consensus Estimate for BERY’s fiscal 2024 (ending September 2024) earnings has been revised 4.5% downward.
Price Performance: Shares of the company have declined 0.8% in the past six months against the industry’s 2.2% increase.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked companies from the Industrial Products sector are discussed below:
Enerpac Tool Group Corp. (EPAC - Free Report) presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
EPAC delivered a trailing four-quarter average earnings surprise of 21.9%. In the past 60 days, the Zacks Consensus Estimate for Enerpac’s fiscal 2024 earnings has increased 2.3%. The stock has risen 6.9% in the past six months.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 13.9%.
The Zacks Consensus Estimate for AIT’s fiscal 2024 earnings has remained steady in the past 60 days. Shares of Applied Industrial have gained 16.8% in the past six months.
Crane Company (CR - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 29.8%.
In the past 60 days, the Zacks Consensus Estimate for Crane’s 2023 earnings has remained steady. The stock has risen 22.9% in the past six months.