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Berry Global (BERY) Announces Addition of R5 Asset in China

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Berry Global Group, Inc. (BERY - Free Report) recently announced that it is investing in a Reicofil R5 asset at one of its manufacturing facilities located in Nanhai, China. The company has prioritized the production of non-woven healthcare materials for healthcare markets in Asia, and its latest announcement is in line with that. Notably, as a major manufacturer and distributor of non-woven specialty materials, the company holds an important place in the supply chain of healthcare materials.

Inside the Headlines

The move will help Berry Global to cater to the growing demand for the healthcare materials, primarily in the Southeast Asia region. The inclusion work of this additional Reicofil R5 asset at the Nanhai facility follows the company’s successful commercialization of its first R5 asset in the same facility in January this year.

This investment decision is also in sync with Berry Global’s fight against the coronavirus-led slowdown. Notably, in May 2020, the company made efforts to drive its global Meltex meltblown capacity with the inclusion of an additional meltblown asset in Berlin for the production of high-efficiency filtration media. Moreover, in April, it added another meltblown capacity at its Waynesboro plant with the expansion of its state-of-the-art Meltex platform.

Zacks Rank, Price Performance and Estimate Trend

Berry Global, with a $6.6-billion market capitalization, currently carries a Zacks Rank #3 (Hold). The company’s diversified business structure allows it to mitigate the weakness in one end market with strength the across others. Also, its focus on improving operational productivity, along with its cost-reduction actions and partnerships across the value chain, is likely to be beneficial. However, the pandemic-induced market downturn, weakness in the industrial end markets and high-debt level remain major concerns for the company.

In the past three months, the company has rallied 16% compared with the industry’s growth of 12.5%.



In the past 60 days, the Zacks Consensus Estimate for earnings in fiscal 2020 (ended September 2020) has risen 1.3% to $4.51 while the same for fiscal 2021 (ending September 2021) moved 0.8% north to $5.14.

Stocks to Consider

Some better-ranked companies from the same space are Graphic Packaging Holding Company (GPK - Free Report) , Packaging Corporation of America (PKG - Free Report) and Sealed Air Corporation (SEE - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Graphic Packaging delivered a positive earnings surprise of 16.53%, on average, in the trailing four quarters.

Packaging Corporation delivered a positive earnings surprise of 8.47%, on average, in the trailing four quarters.

Sealed Air delivered a positive earnings surprise of 17.87%, on average, in the trailing four quarters.

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