BLL

Ball Corp.

Industrial/Transportation


Presented:09/23/2020
Price:$79.85
Cap:$26.08B
Current Price:$66.03
Cap:$20.04B

Presented

Date09/23/2020
Price$79.85
Market Cap$26.08B
Ent Value$30.39B
P/E Ratio72.56x
Book Value$8.46
Div Yield0.75%
Shares O/S326.57M
Ave Daily Vol1,778,133
Short IntN/A

Current

Price$66.03
Market Cap$20.04B
Ball Corp. provides metal packaging for beverages, foods and household products. It operates through the following business segments: Beverage Packaging, North and Central America; Beverage Packaging, South America; Beverage Packaging, Europe; and Aerospace. The Beverage Packaging, North and Central America segment sold under multi-year supply contracts to fillers of carbonated soft drinks, beer, energy drinks and other beverages. The Beverage Packaging, South America segment sales volumes of beverage containers in South America, and manufacture substantially all of the metal beverage containers in Brazil. The Beverage Packaging, Europe segment sales volumes of metal beverage containers in Europe, and other packaging materials used by the European beer and carbonated soft drink industries. The Aerospace segment provides diversified technical services and products to government agencies, prime contractors and commercial organizations for a broad range of information warfare, electronic warfare, avionics, intelligence, training and space system needs. The company was founded by Edmund Burke Ball, Frank Clayton Ball, George A. Ball, Lucius Lorenzo Ball and William Charles Ball in 1880 and is headquartered in Broomfield, CO.

Publicly traded companies mentioned herein: Ball Corp (BLL), Crown Holdings Inc (CCK)

Highlights

The presenter is short shares of Ball Corp (BLL). He describes BLL as a consensus long, with the bull case for the company predicated in part on the consolidation of the industry, disciplined management teams, demand growth, and strong FCF generation. Historically, BLL has traded around 11x - 12x EBITDA vs. the current 16x - 17x. He doesn’t believe that the expected outgrowth and margin uplift justifies this premium and sees ~30% downside based on the entrance of CANPACK (a European can producer) into the U.S. market, a contrarian view that demand growth isn’t as robust as it may appear, and that BLL’s true FCF conversion isn’t 100%. 

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