Sealed Air (SEE) Stock Forecast & Price Target

Sealed Air's positive outlook is bolstered by expected long-term growth rates of 2-3% in the food packaging segment, driven by a robust US cattle herd cycle, coupled with a 3-4% growth trajectory in the protective segment, fueled by its diverse product offerings targeting manufacturing and e-commerce markets. The company's strategic focus on automation and restructuring has yielded higher operating leverage and incremental margins, enhancing overall profitability despite challenging volume forecasts. Additionally, the upward revision of 2025 earnings per share guidance to $3.25-3.35, alongside anticipated EBITDA growth to $1.12-1.14 billion, signals strong operating discipline and improving productivity, particularly in the context of ongoing recovery in industrial sectors.

Sealed Air's financial outlook is negatively impacted by a decline in food segment volumes, with a reported decrease of approximately 0.2% year-over-year in the third quarter, attributed to consumer softness and a significant drop in beef consumption. Additionally, the protective segment has faced ongoing volume declines since mid-2022, with expectations for additional volume headwinds extending into 2025 due to lower meat consumption and inflation-related trading down by consumers. The company anticipates a decremental 2.5% contraction in volumes for the fourth quarter, highlighting substantial challenges stemming from declining beef production and ongoing macroeconomic pressures.