Robert W. Baird analyst Ghansham Panjabi maintained a Buy rating on AptarGroup (ATR – Research Report) on January 11 and set a price target of $150.00.
Ghansham Panjabi has given his Buy rating due to a combination of factors that indicate a bullish case for AptarGroup’s stock. At the core of his analysis is the anticipated growth in the Pharmaceuticals sector and the implementation of self-improvement initiatives across the Packaging portfolio. Panjabi projects that these factors will drive a significant earnings increase, estimating an EPS of $7.00 to $7.50 by the year 2027. The comprehensive analysis also incorporates a sum-of-the-parts valuation and compares the current price-to-earnings (P/E) ratio to historical averages, illustrating that the stock is undervalued and has asymmetric upside potential from its current level.
Furthermore, the unique mix of AptarGroup’s business, particularly the high-growth and high-margin Pharmaceuticals segment, justifies a premium valuation for the company. While the market has contemplated a split of the company’s portfolio, the attractiveness of the Pharmaceuticals segment underpins a conservative valuation in the mid-to-high 20x P/E range. Panjabi also highlights the company’s potential for sustained profit improvement through 2027, supported by both the Packaging and Pharmaceutical segments. The discounted stock price analysis further bolsters the case for a $150 price target, representing a significant upside from the stock’s present valuation. Hence, AptarGroup is reaffirmed as a top pick, given its defensive quality and potential for sustained earnings growth.
ATR’s price has also changed slightly for the past six months – from $115.510 to $126.840, which is a 9.81% increase.
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AptarGroup (ATR) Company Description:
AptarGroup, Inc. develops manufactures and sales of consumer product dispensing systems. It operates through the following business segments: Beauty & Home, Pharma and Food & Beverage. The Beauty & Home segment primarily sells pumps, aerosol valves and accessories to the personal care and household markets and pumps and decorative components to the fragrance/cosmetic market. The Pharma segment supplies pumps and metered dose inhaler valves to the pharmaceutical market worldwide. The Food & Beverage segment sell dispensing and non-dispensing closures and, to a lesser degree, spray pumps and aerosol valves to the food and beverage markets. The company was founded in 1940 and is headquartered in Crystal Lake, IL.
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