Silgan (NYSE:SLGN) Shares Gap Down Following Weak Earnings

Key Points

• Silgan Holdings Inc. experienced a significant drop in stock price, opening at $50.64 after closing at $55.80 due to weaker-than-expected earnings.
• The company reported an EPS of $1.01, which fell short of the consensus estimate of $1.03, but its revenue of $1.54 billion slightly exceeded expectations.
• A quarterly dividend of $0.20 per share was declared, providing an annualized yield of 1.73%, with a payout ratio of 29.74%.

Shares of Silgan Holdings Inc. (NYSE:SLGN - Get Free Report) gapped down prior to trading on Wednesday following a weaker than expected earnings announcement. The stock had previously closed at $55.80, but opened at $50.64. Silgan shares last traded at $47.05, with a volume of 850,436 shares trading hands.

The industrial products company reported $1.01 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $1.03 by ($0.02). Silgan had a net margin of 4.90% and a return on equity of 19.98%. The company had revenue of $1.54 billion during the quarter, compared to analysts' expectations of $1.53 billion. During the same period last year, the business posted $0.88 earnings per share. The company's quarterly revenue was up 11.4% on a year-over-year basis.

Silgan Dividend Announcement

The business also recently announced a quarterly dividend, which was paid on Monday, June 16th. Shareholders of record on Monday, June 2nd were issued a $0.20 dividend. The ex-dividend date of this dividend was Monday, June 2nd. This represents a $0.80 dividend on an annualized basis and a yield of 1.7%. Silgan's dividend payout ratio (DPR) is 28.47%.

Analysts Set New Price Targets

SLGN has been the subject of a number of research analyst reports. JPMorgan Chase & Co. raised shares of Silgan from a "neutral" rating to an "overweight" rating and set a $57.00 target price for the company in a report on Thursday, May 1st. Citigroup increased their price target on shares of Silgan from $60.00 to $63.00 and gave the company a "buy" rating in a research report on Thursday, May 8th. Truist Financial increased their price target on shares of Silgan from $62.00 to $67.00 and gave the company a "buy" rating in a research report on Friday, July 11th. Bank of America reiterated a "neutral" rating and issued a $59.00 price target (up from $57.00) on shares of Silgan in a research report on Wednesday, July 9th. Finally, Raymond James Financial lowered their price target on shares of Silgan from $64.00 to $60.00 and set a "strong-buy" rating on the stock in a research report on Thursday. Two analysts have rated the stock with a hold rating, seven have issued a buy rating and one has given a strong buy rating to the stock. Based on data from MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and a consensus target price of $62.44.

Insider Buying and Selling

In related news, EVP Robert B. Lewis sold 10,000 shares of the firm's stock in a transaction that occurred on Monday, May 19th. The shares were sold at an average price of $55.92, for a total transaction of $559,200.00. Following the sale, the executive vice president owned 153,378 shares in the company, valued at approximately $8,576,897.76. This trade represents a 6.12% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, VP B Frederik Prinzen sold 2,378 shares of the firm's stock in a transaction that occurred on Tuesday, May 6th. The stock was sold at an average price of $54.05, for a total transaction of $128,530.90. Following the sale, the vice president owned 1,380 shares in the company, valued at approximately $74,589. This trade represents a 63.28% decrease in their position. The disclosure for this sale can be found here. 1.13% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Silgan

A number of hedge funds have recently made changes to their positions in the stock. Y Intercept Hong Kong Ltd acquired a new position in shares of Silgan in the 2nd quarter valued at $1,925,000. MQS Management LLC acquired a new position in shares of Silgan in the 2nd quarter valued at $302,000. Caitong International Asset Management Co. Ltd boosted its holdings in shares of Silgan by 174.6% in the 2nd quarter. Caitong International Asset Management Co. Ltd now owns 497 shares of the industrial products company's stock valued at $27,000 after purchasing an additional 316 shares during the last quarter. First Citizens Bank & Trust Co. acquired a new position in shares of Silgan in the 2nd quarter valued at $601,000. Finally, William Blair Investment Management LLC acquired a new position in shares of Silgan in the 2nd quarter valued at $29,053,000. Institutional investors and hedge funds own 70.25% of the company's stock.

Silgan Stock Performance

The stock's fifty day simple moving average is $54.45 and its two-hundred day simple moving average is $52.96. The company has a debt-to-equity ratio of 1.67, a quick ratio of 0.28 and a current ratio of 0.48. The company has a market cap of $4.89 billion, a price-to-earnings ratio of 16.27, a price-to-earnings-growth ratio of 1.14 and a beta of 0.69.

Silgan Company Profile

Silgan Holdings Inc, together with its subsidiaries, manufactures and sells rigid packaging solutions for consumer goods products in the United States and internationally. It operates through three segments: Dispensing and Specialty Closures, Metal Containers, and Custom Containers. The Dispensing and Specialty Closures segment offers a range of metal and plastic closures, and dispensing systems for food, beverage, health care, garden, home, personal care, beauty products, and hard surface cleaning products, as well as capping/sealing equipment and detection systems.