Smurfit Westrock Plc (SW), headquartered in Dublin, Ireland, manufactures, distributes, and sells containerboard, corrugated containers, and other paper-based packaging products. Valued at $27.9 billion by market cap, the company operates in 40 countries and taps into the expertise of over 100,000 people, providing its customers with the most diverse, innovative, and sustainable range of renewable and recyclable packaging solutions.
Shares of this packaging giant have underperformed the broader market this year. SW has declined marginally over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 4%. However, over the past six months, SW stock is up 30.2%, surpassing the SPX’s 12.1% rise on a six-month basis.
Narrowing the focus, SW’s underperformance is also apparent compared to the Consumer Discretionary Select Sector SPDR Fund (XLY). The exchange-traded fund has gained about 1.2% on a YTD basis. However, SW’s gains over the past six months outshine the ETF’s 28.2% returns over the same time frame.
On Feb. 12, SW shares closed down more than 5% after reporting its Q4 results. Its EPS increased 47.4% year over year to $0.28. The company’s net sales stood at $7.5 billion, up 163.4% from the year-ago quarter.
For fiscal 2025, ending in December, analysts expect SW’s EPS to grow 58.2% to $3.29 on a diluted basis. The company’s earnings surprise history is disappointing. It missed the consensus estimates in three of the last four quarters while beating the forecast on another occasion.
Among the 14 analysts covering SW stock, the consensus is a “Strong Buy.” That’s based on nine “Strong Buy” ratings, two “Moderate Buys,” and three “Holds.”
This configuration is more bullish than a month ago, with eight analysts suggesting a “Strong Buy.”
On Feb. 14, Wells Fargo & Company (WFC) analyst Gabrial Hajde maintained a “Hold” rating on SW with a price target of $53.
The mean price target of $61.08 represents a 13.8% premium to SW’s current price levels. The Street-high price target of $68 suggests an upside potential of 26.7%.
