Berry Global Group (BERY:NYS) Fundamental Valuation Report

Fundamental Valuation Report

Berry Global Group(BERY:NYS)

Consumer Cyclical:Packaging & Containers

This Report was generated using the valuation tools available on For a free 30 day trial click here.

Close Price/Date
$49.95 (USD) 19/11/2018

Weighted Valuation
$55.14 (USD)

Overall Rating
Undervalued by 10.4%

Valuation Models Analyst Consensus: $63.75 (USD)
(in order of importance) Comparables: $42.22 (USD)
Valuation Methods This company is:
Cash Flow: Undervalued on a Cash Flow Valuation
Comparable Company: Overvalued on a Comparable Valuation
Asset: Undervalued on an Asset Valuation

Company Overview (BERY:NYS USD)

Price 49.95
Range 49.86 – 51.69
52 week 40.81 – 61.03
Open 50.08
Vol / Avg. 2.49M/1.47M
Mkt cap 6.55B
P/E 13.61
Div/yield 0.00/0.00
EPS 3.67
Shares 131.2M
Beta 1.20

Company Description

Berry Global Group Inc manufactures and sells plastic packaging products in three segments based on product type. The consumer packaging segment, which generates the most revenue of any segment, sells containers, plastic drink cups, prescription vials, and printed bags for food products. The health, hygiene and specialties segment sells baby diapers, feminine hygiene products, and substrates for dryer sheets. The engineered materials segment sells tapes, retail trash bags, plastic films used to wrap meat, and shrink films. The majority of revenue comes from North America.

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for BERY:NYS

Using a discounted cash flow model we generated an intrinsic value of $144.19 (USD) for BERY:NYS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

BERY:NYS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $144.19 1% 5% 1% 5%
WACC (or Ke) 7.64 $191.00 $112.88
Terminal Growth Rate 2.60 $115.57 $186.98
Tax Rate 0.04 $154.33 $134.12
Cash Flow 1,615,950,000 $133.31 $155.07
Capital Expenditures -247,400,000 $142.73 $145.65
Long Term Debt 5,878,000,000 $146.43 $141.95

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $42.22 (USD) for BERY:NYS. We also generated a valuation of $43.81 (USD) using other metrics and comparables.
The comparable companies were Crown Holdings (CCK:NYS), Greif (GEF:NYS), International Paper (IP:NYS), Silgan Holdings (SLGN:NAS) and Sonoco Products (SON:NYS).

Company BERY:NYS End Date Value
Earnings/Share $3.67 (USD)
Book Value/Share $10.17 (USD)
Sales/Share $56.63 (USD)
Cash Flow/Share $7.00 (USD)
EBITDA/Share $9.42 (USD)
Price Based on Comps Adjustment Factor (%)
$52.07 (USD) 0.0
$35.47 (USD) 0.0
$42.43 (USD) -18.6
$19.07 (USD) -30.7
$82.52 (USD) 16.7
12.53 PE Ratio 14.19 18.88 13.71 7.23 8.37 22.74
4.29 PB Ratio 3.49 6.08 2.50 2.68 3.17 3.01
0.77 PS Ratio 0.75 0.53 0.72 0.84 0.62 1.03
6.23 PCF Ratio 8.90 7.08 10.90 9.78 6.15 10.60
8.78 EV to EBITDA 8.76 9.51 7.56 7.94 8.95 9.82


Using a multiples approach we generated a valuation of  $79.54 (USD) for BERY:NYS

Company BERY:NYS End Date Value
Earnings/Share $3.67 (USD)
Book Value/Share $10.17 (USD)
Sales/Share $56.63 (USD)
Cash Flow/Share $7.00 (USD)
EBITDA/Share $9.42 (USD)
Price Based on Comps Adjustment Factor
$120.54 (USD) 0
$73.62 (USD) 0
$49.90 (USD) 0
$51.98 (USD) 0
$101.66 (USD) 0
Ratios Ratio Average
PE Ratio 32.84
PB Ratio 7.24
PS Ratio 0.88
PCF Ratio 7.43
EV to EBITDA 10.79

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  BERY:NYS for the last 2 years was  7.15

We ran the Adjusted Book Value for  BERY:NYS and generated a book value of  $10.89 (USD)
By multiplying these we get an adjusted valuation of  $77.87 (USD)

Analyst Data

In the Stockcalc database there are 4 analysts that provide a valuation for BERY:NYS. The 4 analysts have a concensus valuation for BERY:NYS for 2019 of $63.75 (USD).

BERY:NYS Berry Global Group

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
4 0 0 5.0000 Buy 2018-11-16

Current Price: 49.95 USD

Analyst Consensus
USD Millions 2019 2020 2021
Mean EPS 3.96 4.27 4.60
# EPS Analysts 4 3 1
Mean Revenue 8,198.80 8,328.10 8,422.40
# Revenue Analysts 4 3 1
Mean Target Price 63.75
Mean Cash Flow 8.08 8.50 8.95
Mean EBITDA 1,508.20 1,568.70 1,575.00
Mean Net Income 531.30 571.30 588.20
Mean Debt Outstanding 4,702.80 4,042.60
Mean Tax Rate 25.50
Mean Growth Rate
Mean Capital Expenditure 342.00 336.70 350.00

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.

The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).

The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.

With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.

If we have Analyst coverage for the company we use the consensus target price here.

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