Crown Earnings: Global Aluminum Can Demand Continues to Recover as Destocking Moderates

Narrow-moat-rated Crown Holdings reported solid second-quarter results as global aluminum can demand continued to recover. Net sales declined roughly 2% year over year as strength in the Americas and Europe was offset by persistent headwinds in Asia-Pacific and Crown’s transit packaging business. Destocking headwinds, which have weighed heavily on the Americas and European can markets, appear to have largely abated as Crown experienced a 6% increase in global beverage can shipments. We are encouraged by the recovery Crown experienced in the quarter given the impact destocking has had on its business for much of the last two years. As such, we've increased our fair value estimate to $97 per share from $94 due to higher near-term profitability in our forecast.