FY21 results were ahead of UBS estimates. Growth was underpinned by Bemis synergies and share buyback accretion. Guidance for FY22 is for growth of 7-11%.
The Bemis merger synergy target has also been raised to around $200m with the final benefits to be delivered in FY22. With free cash flow growth of up to 9% the company has capacity to fund $700m in dividends as well as the $400m share buyback program that was announced.
UBS finds the valuation attractive and retains a Buy rating. Target is raised to $18.93 from $17.40.
Target price is $18.93.Current Price is $17.02. Difference: $1.91 – (brackets indicate current price is over target). If AMC meets the UBS target it will return approximately 10% (excluding dividends, fees and charges – negative figures indicate an expected loss).