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(ShareCast News) - Goldman Sachs recommended clients 'buy' Smurfitt Kappa on Monday after the shares fell by around 7% over the past month to open an attractive entry point, while Jefferies also rated the Irish packaging company highly. Smurfit remained Goldman's top-pick in the European paper and packaging space, as although the market has become increasingly concerned about a margin squeeze, this "is temporary in our view" as box prices are expected to increase in the second half to enable margins to recover quickly. Smurfit trades at an 26% discount to peers on a ratio of enterprise value to adjusted operating profits (EV/EBITDA), despite offering a 10.5% free cash flow yield, which is significantly above the 5.6% average for packaging peers. Rivals DS Smith and Mondi are both rated 'neutral' by Goldman. "A key risk to our packaging view is increased uncertainty in Europe related to the upcoming elections. Packaging is closely linked to economic growth and could come under pressure if uncertainty increases," Goldman said. Analysts trimmed their London target price to 2,425p from 2,500p.
I used to trade this share in the £5 /£6 range and left well alone after it started its demise but i have always kept an eye it. and have to agree with you chris that maybe just maybe they have hit the level to start and rebuild . and with the points you mention in your post it might just be about to start climbing again, So i am in to for a bit of a punt .patience might be required but there could be some good gains for he who waits .
NKOTB I KNOW WHERE YOU ARE COMING FROM but Patients it will come back up in its own good time I think stan and other shares had the triple whammy XDiv on going Russia/crimea crisis,china numbers,=market nervousness my average buy price is 12.67 hoping for 12.80/1300 in the next 7/8 weeks
Nice rise 18.5 up at the time of writing although it was down 10p or so in early trade. I tend to agree with you Gerry sp at the lower end of year trading range divi increase and xd next wed , and the management stripping away the fat.Theres also the other side of the coin china emerging markets etc that might put a downer on things but for the time being I am quite happy to hold if stops in this trading range GLA