Hedgeye CEO Keith McCullough is adding Ball Corp (BLL) to the short side of Investing Ideas. Below is a brief note.
Looking for Industrials Shorts ahead of what will be a #Quad4 in Q3 Earnings Season? Industrials Analyst Jay Van Sciver's latest Best Idea Short (Institutional Research Product) is Ball Corp (BLL).
Here's the invite to the call Jay just hosted:
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The production of aluminum cans is a low/no growth, reasonably consolidated industry that used to be rated an ‘Okay, I guess’ by investors. Over the past 18 months, however, shares of Ball have moved to an excessive valuation, leaving behind other packaging companies. We’ll explore the reasons for this, like freight costs, and misperceptions about the plastic substitutions, input costs, labor, liabilities, and catalysts for revaluation this Friday, September 27th at 10AM. Packaging, like commercial services, can seem an attractive hiding place in an industrial slowdown, but we think it is in fact risky at these levels. Shares of BLL could well underperform peers by 50% as capacity, Rexam accruals/charges, and unrealistic estimates finally impact investor expectations. |
Sell the bounce to lower highs (insiders have!),
KM