Amcor: Tough Markets Make Lasting Businesses

Amcor is rated a buy, trading at a 30% sector discount despite strong post-merger sequential growth and robust margin expansion. AMCR's merger with Berry delivers significant synergies, driving EBIT margins to 9.6% in Q4 FY2026, up from 7.2% YoY, and targets $650M in annual-run-rate synergies. Resilient gross margins and effective cost pass-through shield AMCR from volatile resin input costs, supporting stable cash flows and a 6.12% forward dividend yield. With a projected $2.5B FY2027 FCF and sector multiples implying 14.7% upside, AMCR offers a compelling 12-month total return potential near 18%.

The market seems to have either turned its back or forgotten about packaging companies because the valuations of these companies are starting to look quite