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Ball Corporation's (BLL) Prospects Bleak on Low Can Demand

On Apr 5, we issued an updated research report on Ball Corporation BLL.

Sluggish can demand continues to hamper the company’s performance. In addition, escalating expenses, poor end-market demand for carbonated drinks, as well as the dismal European economy are likely to hurt Ball Corporation’s performance in 2017.

Notably, Ball Corporation expects overall can demand to remain relatively flat in 2017. The company also foresees overall flat volumes for the year, but it might be a little softer in the first half and a little stronger in the second half.

Ball Corporation projects full-year 2017 interest expense to be roughly $280 million. The company anticipates year-end net debt to be in the range of $6.2–$6.3 billion. Full-year effective tax rate for 2017 on comparable earnings is likely to be around 28%.

Further, corporate undistributed costs for full-year 2017 is now estimated to be nearly $115 million, due to higher IT and certain costs which were initially allocated to the segments, like European pensions. These escalated expenses are expected to affect earnings for this year.

Additionally, persistent weakness at the end-market level for carbonated drinks, beer and food pose challenges for the company. The economies in Europe continue to be weak, which, in turn, are predicted to hit Ball Corporation’s performance.

Moreover, Ball Corporation underperformed the Zacks classified Containers- Metal/ Glass sub-industry with respect to price performance over the past one year. The stock gained around 3%, while the industry recorded growth of 11.1%.

Ball Corporation currently has a Zacks Rank #4 (Sell).

Stocks to Consider

Some better-ranked stocks in the industrial products sector include ACCO Brands Corporation ACCO, Casella Waste Systems, Inc. CWST and Roper Technologies, Inc. ROP. All three stocks flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

ACCO Brands Corporation has an average positive earnings surprise of 24.74% for the trailing four quarters. Casella Waste Systems has an impressive average earnings surprise of 165.21% for the last four quarters, while Roper Technologies has an average earnings surprise of 0.92%.

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Ball Corporation (BLL): Free Stock Analysis Report
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Casella Waste Systems, Inc. (CWST): Free Stock Analysis Report
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