NEW YORK, Dec 7 (Reuters) - Packaging outfits such as Crown Holdings Inc, Silgan Holdings, Owens-Illinois Inc and Ball Corp are boasting attractive valuations given the group's defensive qualities and its potential for double-digit earnings gains in 2009 barring a much deeper recession, Barron's said on Sunday.
Packaging companies boast stable revenue growth and generate a lot of cash, and they have pricing power and are benefiting from the drop in raw materials prices such as plastic and resin that resulted from the decline in oil prices, according to Barron's.
The industry is selling for just 11 times the past 12 months' earnings -- cheaper than consumer-staples stocks, Barron's said in its Dec. 8 edition.
'It's amazing how investors will hide in consumer products but forget that the suppliers to that sector are just as defensive,' Wachovia's packaging analyst Ghansham Panjabi was quoted as saying in Barron's.
Ball, Crown, Silgan and Owens-Illinois make rigid packaging such as cans, jars and bottles and are especially well-positioned right now because of their exposure to the food and beverage markets. Their shares also are relatively inexpensive, trading at an average of eight times this year's expected earnings, Barron's said.
(Reporting by Helen Chernikoff, editing by Maureen Bavdek) Keywords: PACKAGINGCOMPANIES/SHARES (helen.chernikoff@thomsonreuters.com; +1 646 223 6127; Reuters Messaging: helen.chernikoff.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2008. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
Packaging companies boast stable revenue growth and generate a lot of cash, and they have pricing power and are benefiting from the drop in raw materials prices such as plastic and resin that resulted from the decline in oil prices, according to Barron's.
The industry is selling for just 11 times the past 12 months' earnings -- cheaper than consumer-staples stocks, Barron's said in its Dec. 8 edition.
'It's amazing how investors will hide in consumer products but forget that the suppliers to that sector are just as defensive,' Wachovia's packaging analyst Ghansham Panjabi was quoted as saying in Barron's.
Ball, Crown, Silgan and Owens-Illinois make rigid packaging such as cans, jars and bottles and are especially well-positioned right now because of their exposure to the food and beverage markets. Their shares also are relatively inexpensive, trading at an average of eight times this year's expected earnings, Barron's said.
(Reporting by Helen Chernikoff, editing by Maureen Bavdek) Keywords: PACKAGINGCOMPANIES/SHARES (helen.chernikoff@thomsonreuters.com; +1 646 223 6127; Reuters Messaging: helen.chernikoff.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2008. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.