Our Long-Term Outlook Remains Unchanged Following Ball Corporation’s 2022 Investor Day

Narrow-moat-rated Ball Corporation held its investor day on Sept. 22, where it provided updates on its segment operations and end-market outlook. Following the event, our $60 fair value estimate is unchanged, as our long-term thesis remains intact. Despite the announcement of capacity curtailment last month, Ball’s end-market demand remains strong. Aluminum can volume is up 2.4% year over year through June of this year while the firm continues to realize selling price increases. Management made a rare misstep when committing to rapid capacity expansion last year in hopes of fulfilling new end market demand. We think this was a one-time mistake that will lead to more disciplined capital spending in the future.