| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 31.00 | -55 |
| Intrinsic value (DCF) | 27.62 | -60 |
| Graham-Dodd Method | n/a | |
| Graham Formula | 17.30 | -75 |
Berry Global Group, Inc. (LSE: 0HN1.L) is a leading global manufacturer and supplier of innovative packaging and engineered material solutions, serving diverse consumer and industrial markets. Headquartered in Evansville, Indiana, the company operates through four key segments: Consumer Packaging International, Consumer Packaging North America, Engineered Materials, and Health, Hygiene & Specialties. Berry Global specializes in non-woven, flexible, and rigid packaging products, including closures, containers, films, and healthcare solutions. With a strong presence in North America, Europe, and international markets, the company leverages a direct sales force and distributor network to deliver high-performance packaging solutions. Berry Global plays a critical role in the $1 trillion+ global packaging industry, addressing sustainability trends with recyclable and lightweight materials. The company’s broad product portfolio serves essential sectors such as food & beverage, pharmaceuticals, personal care, and agriculture, positioning it as a key player in the consumer cyclical sector.
Berry Global presents a mixed investment profile with strengths in diversified end markets and stable cash flows but faces challenges from high leverage and cyclical demand. The company’s $7.8B market cap and $12.3B revenue reflect its scale in the packaging industry, while its 1.11 beta indicates moderate volatility relative to the market. Positive aspects include robust operating cash flow ($1.4B) and a solid dividend ($1.17/share), but investors should note the elevated debt load ($8.8B) and thin net margins (~4.2%). The stock may appeal to income-focused investors and those bullish on sustainable packaging trends, though exposure to resin price fluctuations and competition from low-cost producers warrants caution.
Berry Global competes in the fragmented global packaging industry by leveraging its diversified product portfolio, vertical integration, and multinational footprint. Its competitive advantage stems from economies of scale (115M shares outstanding), R&D capabilities in sustainable materials, and long-term customer relationships in stable end markets like healthcare and food packaging. However, the company faces intense competition from larger peers like Amcor in rigid packaging and smaller regional players in flexible films. Berry’s Engineered Materials segment competes on technical performance (e.g., high-barrier films), while Health/Hygiene benefits from regulatory tailwinds. The $551M in annual capex demonstrates commitment to operational efficiency, but debt-servicing costs may limit pricing flexibility against rivals with stronger balance sheets. Geographic diversification (40%+ sales outside North America) provides stability but exposes the firm to currency risks. Sustainability initiatives like PCR plastic adoption help differentiate Berry in eco-conscious markets, though material science innovations from competitors remain a threat.