- Sealed Air (SEE +3.9%) soars to a new all-time high, gaining 13.5% over the past two days after reporting stronger than expected Q1 earnings and raising full-year guidance despite a historic surge in U.S. resin prices, followed by an upgrade at J.P. Morgan.
- Sealed Air now sees FY 2021 EPS of $3.40-3.55 vs. its previous guidance of $3.25-$3.40 and above $3.38 analyst consensus estimate, on revenues of $5.25B-$5.35B vs. prior guidance of $5.1B-$5.2B and above $5.18B consensus.
- In its upgrade to Overweight from Neutral with a $63 price target, J.P. Morgan's Jeffrey Zekauskas notes Sealed Air was able to improve Q1 EBITDA Y/Y despite sharp raw material price increases stemming from higher resin values.
- "Raw material prices are likely to continue to rise through the June quarter, but Sealed Air's product prices should begin to lift at a more rapid rate leading to diminished raw material price/cost pressure" in H2 2021, Zekauskas writes.
- "With an adjusted sustaining free cash flow north of $600M per year, Sealed Air is rapidly improving its balance sheet and financial flexibility," The Investment Doctor writes in a bullish analysis recently published on Seeking Alpha.