Ball's Selloff Is 'Largely An Overreaction,' Says Bullish Analyst, Who Sees 'Resilient Volume Growth Despite Some Incremental Headwinds'

Ball Corp BALL shares have lost around 9% over the past month.

The recent selloff in the stock offers an "attractive entry point," given the growth in the company's earnings, volumes and free cash flows, according to Truist Securities.

The Ball Analyst: Michael Roxland upgraded the rating for Ball from Hold to Buy, while raising the price target from $67 to $76.

The Ball Thesis: The stock has declined by around 12% since June 5, versus a 2% gain in the S&P 500, Roxland said in the upgrade note.

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The stock is now trading at multiples below the average over the last five years, he added.

The pressure on the stock followed "muted volume expectations" from management during the company's latest investor day, "phrasing regarding its updated earnings growth algorithm (~10%+ per year vs. a previous ~10-15%), and concerns around a possible greenfield plant in the Pacific Northwest, the analyst stated. The selloff is "largely an overreaction," he wrote.

"We upgrade to Buy due to resilient volume growth despite some incremental headwinds in North American energy drinks at present, strong FCF generation, industry-leading capital return to shareholders, and low leverage," Roxland further said.

BALL Price Action: Shares of Ball are down 1.07% to $60.92 at the time of publication on Tuesday.

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