What Happened?
Shares of integrated packaging solutions provider Sealed Air Corporation (NYSE: SEE) jumped 18% in the afternoon session after reports surfaced that the company was in advanced talks to be acquired by private equity firm Clayton, Dubilier & Rice.
Following the news, which was reported by The Wall Street Journal, the company's share price surged. The discussions, though described by some sources as still in an early stage, were significant enough to fuel strong investor interest. Analysts suggested a potential takeover could value the company's equity between $50 and $60 per share. The buyout interest followed a period of strong financial performance for Sealed Air. In its third quarter, the company surpassed expectations with an adjusted EPS of $0.87 on revenue of $1.35 billion, beating consensus estimates. This solid performance had already prompted firms like Truist and RBC Capital to raise their price targets, signaling growing confidence in the company's direction before the acquisition talks became public.
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What Is The Market Telling Us
Sealed Air’s shares are not very volatile and have only had 9 moves greater than 5% over the last year. Moves this big are rare for Sealed Air and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was 9 months ago when the stock gained 11.6% on the news that the company reported impressive fourth-quarter 2024 results that outperformed analysts' EPS and EBITDA estimates, even as revenue remained mostly flat year on year. Looking ahead, Sealed Air's full-year 2025 revenue and EPS guidance disappointed, both falling short of analyst expectations. Still, this was a decent quarter.
Sealed Air is up 27.1% since the beginning of the year, and at $42.30 per share, has set a new 52-week high. Investors who bought $1,000 worth of Sealed Air’s shares 5 years ago would now be looking at an investment worth $981.78.
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