Ball Earnings: Mixed End-Market Demand Constrains Shipments but Cost Management Provides Relief

Narrow-moat-rated Ball reported third-quarter results that came with few surprises. Net sales fell roughly 1% year over year due to flat shipment growth and slightly unfavorable prices. Demand was mixed across Ball’s portfolio as the company experienced strong demand in Europe but had some end-market softness in North and South America. That said, most of the headwinds experienced in the quarter were largely expected, and we think Ball will benefit from recovering demand heading into next year. Nevertheless, we are monitoring Ball’s progress in reducing costs as the company optimizes its network following the overbuilding of capacity in recent years, and we expect additional cost improvements in 2025. As such, we have maintained our $60 fair value estimate.