Value
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 3.8 |
| P/S | 9.7 |
| EV/EBITDA | 5.4 |
| Fwd P/E | 9.3 |
| PEG | 9.5 |
| Analyst target | 4.0 |
- ▸Forward P/E: 9.7x
- ▸PEG: 0.58
- ▸Attractively valued
AMCR · Why this verdict
Why Amcor (AMCR) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.1/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Amcor shows 77% revenue growth year-over-year and recovering price momentum, but free cash flow is converting at only 22% of net income, business quality sits at the minimum-threshold floor, a put/call ratio of 3.17 signals elevated institutional hedging demand, and dual concentration in flexible packaging and developed markets limits diversification — the position warrants an exit until quality and cash conversion improve.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Free cash flow converts at only 22% of net income — a red flag indicating that reported earnings substantially overstate the cash the business actually delivers, raising material questions about earnings quality and the sustainability of shareholder distributions. Quality breakdown | Free cash flow as a percentage of net income rises above 60% over the next four quarters, demonstrating that the gap between stated earnings and realized cash generation is closing. | →Stable |
| CounterA low FCF-to-net-income ratio can reflect heavy reinvestment in capacity or packaging innovation that builds long-term franchise value; if working capital or capital expenditure timing is the driver, the conversion ratio recovers sharply in subsequent periods without any deterioration in underlying business quality. | ||
Flexible packaging solutions represent 72% of revenue while 75% of sales come from developed markets, creating a dual concentration that amplifies the impact of any structural shift away from flexible packaging formats or any slowdown in developed-market consumer spending. Bear case | Revenue from either emerging markets or non-flexible-packaging segments grows to represent more than 30% of total revenue within 12 months, demonstrating real diversification progress. | →Stable |
| CounterDeep specialization in one segment can represent a durable competitive position rather than a vulnerability; flexible packaging is a growing global category, and developed-market customers may represent a more stable, lower-churn demand base than emerging-market alternatives. | ||
A put/call ratio of 3.17 combined with implied volatility at 75% signals that derivatives markets are pricing in substantial downside risk, reflecting institutional concern about the stock that has not yet translated into headline price weakness. Risk breakdown | The put/call ratio falls below 1.0 and implied volatility compresses below 50% over the next two months, indicating that hedging demand has normalized and the overhang is clearing. | →Stable |
| CounterElevated put/call ratios can reflect mechanical hedging by long shareholders seeking portfolio protection rather than directional bearishness; if those holders are buy-and-hold income investors satisfied with the dividend, the options signal may overstate genuine selling pressure. | ||
Three of the last four quarters produced earnings beats, with the most recent three consecutive quarters beating estimates after a miss in August 2025 — a pattern showing improving execution, but one built on an average surprise of only 0.18% across all four quarters, leaving almost no buffer against estimate revisions. Catalyst breakdown | EPS beats consensus in each of the next two quarters with a positive surprise percentage, extending the current three-quarter run to five consecutive beats. | →Stable |
| CounterA single-quarter miss would re-expose the inconsistency in execution; with average surprises barely above zero, even modest upward estimate revisions driven by the 77% revenue growth signal could flip recent beats into misses and erode the narrative of reliable delivery. | ||
Free cash flow converts at only 22% of net income — a red flag indicating that reported earnings substantially overstate the cash the business actually delivers, raising material questions about earnings quality and the sustainability of shareholder distributions.
→StableQuality breakdown
- Expectation
- Free cash flow as a percentage of net income rises above 60% over the next four quarters, demonstrating that the gap between stated earnings and realized cash generation is closing.
CounterA low FCF-to-net-income ratio can reflect heavy reinvestment in capacity or packaging innovation that builds long-term franchise value; if working capital or capital expenditure timing is the driver, the conversion ratio recovers sharply in subsequent periods without any deterioration in underlying business quality.
Flexible packaging solutions represent 72% of revenue while 75% of sales come from developed markets, creating a dual concentration that amplifies the impact of any structural shift away from flexible packaging formats or any slowdown in developed-market consumer spending.
→StableBear case
- Expectation
- Revenue from either emerging markets or non-flexible-packaging segments grows to represent more than 30% of total revenue within 12 months, demonstrating real diversification progress.
CounterDeep specialization in one segment can represent a durable competitive position rather than a vulnerability; flexible packaging is a growing global category, and developed-market customers may represent a more stable, lower-churn demand base than emerging-market alternatives.
A put/call ratio of 3.17 combined with implied volatility at 75% signals that derivatives markets are pricing in substantial downside risk, reflecting institutional concern about the stock that has not yet translated into headline price weakness.
→StableRisk breakdown
- Expectation
- The put/call ratio falls below 1.0 and implied volatility compresses below 50% over the next two months, indicating that hedging demand has normalized and the overhang is clearing.
CounterElevated put/call ratios can reflect mechanical hedging by long shareholders seeking portfolio protection rather than directional bearishness; if those holders are buy-and-hold income investors satisfied with the dividend, the options signal may overstate genuine selling pressure.
Three of the last four quarters produced earnings beats, with the most recent three consecutive quarters beating estimates after a miss in August 2025 — a pattern showing improving execution, but one built on an average surprise of only 0.18% across all four quarters, leaving almost no buffer against estimate revisions.
→StableCatalyst breakdown
- Expectation
- EPS beats consensus in each of the next two quarters with a positive surprise percentage, extending the current three-quarter run to five consecutive beats.
CounterA single-quarter miss would re-expose the inconsistency in execution; with average surprises barely above zero, even modest upward estimate revisions driven by the 77% revenue growth signal could flip recent beats into misses and erode the narrative of reliable delivery.
Per-dimension breakdown
Quality
3.0/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.9 |
| ROA | 2.7 |
| Gross margin | 0.0 |
| Op margin | 3.4 |
| Net margin | 1.5 |
| Current ratio | 5.3 |
| FCF quality | 1.8 |
| Moat | 4.9 |
| Piotroski F | 4.4 |
- ▸Earnings quality RED FLAG: 22% FCF/NI
- ▸No competitive moat
- ▸Quality concerns
Growth
5.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
| EPS growth | 0.0 |
- ▸Strong growth: 77% YoY
Momentum
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.2 |
| MACD | 10.0 |
| OBV | 1.0 |
| MA position | 7.5 |
| Volume | 0.0 |
- ▸Overbought (RSI 76)
- ▸Volume distribution (falling OBV)
- ▸Above 200-MA but MA slope flat/negative + RSI 76 (late-cycle distribution risk)
Sentiment
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.0 |
| Price target | 6.9 |
| erm sentiment | 4.9 |
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
5.1/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.0 |
| quality rank | 3.3 |
| growth rank | 9.4 |
- ▸Industry growth leader
Technical
3.1/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.2 |
| support resistance | 0.2 |
| 52w position | 7.2 |
| gap | 5.0 |
Risk (lower is worse)
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.4 |
| days to cover | 3.4 |
| volatility | 6.1 |
| put call | 10.0 |
| implied vol | 7.3 |
| max pain risk | 7.0 |
| beta | 9.2 |
| debt equity | 4.1 |
- ▸Concentration risks: 2 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 2.6 |
| dividend safety | 5.2 |
- ▸Strong earnings: 3B/1M
- ▸Dividend: 623.0%
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (7)
- MOMENTUM:4.5>=4.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:49d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- ASYMMETRY:-0.1=NEGATIVE
- DEATH_CROSS:HARD_BLOCK
Warning (1)
- MOMENTUM:4.5<5.5 (soft — BUY_NOW allowed but watch)
Reward-to-Risk
-0.13
Upside
-1.6%
Downside
12.3%
Sizing output
AVOID
SetupRECOVERY — Death cross but MACD improving, RSI 76
EdgeNO_EDGE — No clear edge identified
SuitabilityMODERATE — Balanced profile
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Value at 7.1 could not lift the engine output above the verdict floor. Failed gate signal: ASYMMETRY:-0.1=NEGATIVE.
The strongest dimensions are Value at 7.1, Risk (lower is worse) at 6.7, and Sentiment at 6.4; the weakest are Quality at 3.0, Technical at 3.1, and Momentum at 4.5. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of -0.13 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Free cash flow converts at only 22% of net income — a red flag indicating that reported earnings substantially overstate the cash the business actually delivers, raising material questions about earnings quality and the sustainability of shareholder distributions.
Trip ifFree cash flow as a percentage of net income rises above 60% for 2 consecutive quarters.
- P2Flexible packaging solutions represent 72% of revenue while 75% of sales come from developed markets, creating a dual concentration that amplifies the impact of any structural shift away from flexible packaging formats or any slowdown in developed-market consumer spending.
Trip ifRevenue from emerging markets or non-flexible-packaging segments crosses 30% of total revenue for 2 consecutive quarters.
- P3A put/call ratio of 3.17 combined with implied volatility at 75% signals that derivatives markets are pricing in substantial downside risk, reflecting institutional concern about the stock that has not yet translated into headline price weakness.
Trip ifPut/call ratio falls below 1.0 for 4 consecutive weeks.
- P4Three of the last four quarters produced earnings beats, with the most recent three consecutive quarters beating estimates after a miss in August 2025 — a pattern showing improving execution, but one built on an average surprise of only 0.18% across all four quarters, leaving almost no buffer against estimate revisions.
Trip ifEPS surprise falls below 0% for 2 consecutive quarters.