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AptarGroup (ATR) Hits 52-Week High: What's Driving the Rally?

Zacks Equity Research

Shares of AptarGroup, Inc. ATR scaled a fresh 52-week high of $120.39 during trading session on Jun 6, before retracing a bit to close at $120.23.

The company has a market cap of $7.40 billion. It has an expected long-term earnings per share growth rate of 10.3%.

Notably, the stock has appreciated 30.1% in a year’s time, higher than the S&P 500’s gain of around 3%. Additionally, AptarGroup has outperformed 3.2% growth recorded by the industry during the same time frame.



Further, AptarGroup carries a Zacks Rank #2 (Buy) and a VGM Score of B, at present. Here V stands for Value, G for Growth and M for Momentum. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities for investors.

Driving Factors

The company delivered year-over-year improvement in first-quarter 2019 adjusted earnings per share and revenues. Both top and bottom lines beat the respective Zacks Consensus Estimate. Stellar core sales growth across all segments, benefits from business transformation, business mix and lower resin cost aided the quarter’s performance.

In late 2017, AptarGroup began a business-transformation plan to drive its top line, boost operational excellence, enhance approach to innovation and improve organizational effectiveness. The company is on track with its business transformation which primarily focuses on the Beauty + Home segment. The company expects this plan to yield incremental EBITDA of approximately $80 million by the end of 2020.

AptarGroup is well placed to gain from the latest innovative product launches. In the Pharma segment, the Bidose Nasal Spray Device was recently approved by the U.S. FDA for breakthrough therapy in the field of depression. This is the first FDA approval and U.S. launch of a prescription drug using AptarGroup’s patented Bidose Nasal Spray delivery system.

In the Beauty + Home segment, the company unveiled a Skin Care Dispensing Pen in China. It features a magnetic applicator which delivers active ingredients to each spot with three times the absorption rate than application with finger. In the Food + Beverage segment, the company has rolled out a flip-lid closure with SimpliSqueeze Valve technology and a built-in tamper evident pull ring fitment for sauces and condiments.

AptarGroup remains committed to business expansion through acquisitions to broaden the scope of technologies, geographic presence and product offerings. In sync with this, the company acquired CSP Technologies, a leader in active packaging technology based on proprietary material science expertise.

Positive Growth Projections: Analysts are steadily growing bullish on the stock. Over the last 90 days, the Zacks Consensus Estimate for the company moved 2.6% north to $4.35 for 2019. For 2020, the Zacks Consensus Estimate for earnings has moved up 2.1% to $4.81, during the same time frame.

The Zacks Consensus Estimate for AptarGroup’s 2019 earnings is currently pegged at $4.35, reflecting expected year-over-year growth of 8.7%. The same for 2020 is pinned at $4.81, indicating a year-over-year rise of 10.5%.

AptarGroup, Inc. Price and Consensus

AptarGroup, Inc. Price and Consensus

AptarGroup, Inc. price-consensus-chart | AptarGroup, Inc. Quote

Other Stocks to Consider

Some other top-ranked stocks in the Industrial Products sector are DMC Global Inc. BOOM, Lawson Products, Inc. LAWS and Harsco Corporation HSC, each sporting a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

DMC Global has an estimated earnings growth rate of 83.5% for the ongoing year. The company’s shares have surged 59.1%, in the past year.

Lawson Products has an expected earnings growth rate of 24.5% for the current year. The stock has appreciated 41.1% in a year’s time.

Harsco has a projected earnings growth rate of 9.1% for 2019. The company’s shares have gained 1.2%, over the past year.

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