Packaging and Containers Sector Ideas

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Ball -- >>> 3 Stocks Any Growth Investor Should Consider



By Federico Zaldua

November 14, 2012



http://beta.fool.com/martinzaldua/2012/11/14/3-stocks-any-growth-investor-should-consider/16490/?ticker=BLL&source=eogyholnk0000001





>>> Coke, Pepsi or Beer? Ball profits from each!

Ball Corp. (NYSE: BLL) is the largest manufacturer of beverage cans in North America, and supplies products to such giant customers as Coca-Cola, Pepsi, AB InBev and MillerCoors. According to Zacks, this provides a competitive edge to the company and strengthens its pricing power in the market. Ball Corp. is also a manufacturer of metal and plastic packaging, primarily for beverages and foods. It also supplies aerospace and other technologies and services to government and commercial customers. This is a solid, predictable business that is great for long term oriented investors.

The company recently reported a very good 9-month performance that was slightly above management expectations. Ball is on track to achieve the goal of 10% to 15% diluted earnings per share growth for 2012. According to Ball's earnings call, the company will keep performing, driven by further emerging market growth, mix shifts to more specialty containers, more normalized weather in North America and Europe, and continued growth in aerospace.

The company plans to expand its global metal beverage can business. Accordingly, Ball acquired four low-cost metal beverage packaging manufacturing plants from AB InBev in the U.S., and announced plans to acquire the remaining 65% interest in a joint venture metal beverage can and end plant in China. Ball is not expensive, as its trailing P/E is just 14.7x, compared to the 16.4x average for the peer group and 14.4x for the S&P 500. This multiple does not reflect Ball's 3 year annual growth rate of 16% and sales growth of 11%. SAC Capital Advisors bought shares of Ball in the recent quarter.

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