We are maintaining our Neutral recommendation on Ball Corporation
with a target price of $68. In the third-quarter 2014, the
company's adjusted earnings improved 10% year over year to $1.10
per share. Ball Corporation maintains its long-term earnings per
share growth goal of 10% 15%. Even though volume was weak in
Brazil, the company expects it to pick up in the summer selling
season. Moreover, Ball Corporation will continue to benefit from
capacity additions, share repurchases and momentum in the Aerospace
business. However, the Aerospace business' dependence on government
funding, high aluminum premiums in Europe and overcapacity in China
Headquartered in Broomfield, Colo., Ball Corporation is a
manufacturer of metal and plastic packaging, primarily for
beverages and foods. It also supplies aerospace and other
technologies and services to government and commercial customers.
The company employs around 15,000 people worldwide and organizes
its businesses in 4 segments:
The Metal Beverage Packaging, Americas & Asia segment (48%
of total revenue in the third quarter of fiscal 2014) consists of
operations located in the U.S., Canada, Brazil, and People's
Republic of China (PRC). In the U.S., Canada and Brazil, the
company manufactures metal container products used primarily in
beverage packaging. Ball's Chinese operations manufacture metal
beverage containers as well as aluminum containers and ends.
The Metal Beverage Packaging, Europe segment (22%) deals with
the company's operations in Europe. The segment supplies two-piece
metal beverage containers and ends for producers of carbonated soft
drinks, beer, energy drinks and other beverages as well as extruded
aluminum aerosol containers and aluminum slugs.
The Metal Food & Household Products Packaging, Americas
segment (20%) is concerned with operations located in the U.S. and
Canada, which manufacture metal container products used primarily
in food packaging.
The Aerospace and Technologies segment (10%) includes national
defense solutions, advanced technologies and products as well as
civil and operational space businesses.
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