Amcor plc (AMCR): A Bull Case Theory

We came across a bullish thesis on Amcor plc on Value investing subreddit by SniperPearl. In this article, we will summarize the bulls’ thesis on AMCR. Amcor plc's share was trading at $8.28 as of September 12th. AMCR’s trailing and forward P/E were 25.88 and 9.95 respectively according to Yahoo Finance.

Amcor Limited (AMCR) is a global packaging leader strategically pivoting from commodity plastics toward high-margin healthcare and hygiene segments through its all-stock merger with Berry Global. The deal, valued at $13.8 billion with over $7 billion of assumed debt, positions AMCR as the largest player in flexible plastics, boosting its global market share to ~7% and creating meaningful procurement leverage over resin and film suppliers.

The healthcare and hygiene businesses provide stickier growth, with 3-4% CAGR, and improve the company’s margins, with healthcare nonwovens delivering ~19% EBITDA. AMCR’s core flexible plastics and rigid packaging businesses continue to serve multinational FMCG giants like Nestle, P&G, and J&J, benefiting from scale, reliability, and bundled offerings that competitors cannot easily replicate.

Financially, AMCR trades at a forward P/E of ~10x, below peers at 12–15x, reflecting execution risk and a highly leveraged balance sheet (~3.5x post-merger). If management successfully realizes merger synergies, free cash flow could double, enabling debt reduction toward ~3.1x–3.0x and supporting a rerating toward 12x P/E, potentially delivering 20–30% upside.

Near-term catalysts include $260 million in FY26 synergy milestones, asset sales, and deleveraging, while medium- and long-term growth drivers include full synergy realization, organic expansion in healthcare/nonwovens, and sustainability mandates favoring recyclable packaging.Risks include the binary nature of synergy execution, potential credit downgrades, U.S.–China tariffs impacting resin costs, forex volatility, and macroeconomic pressures on FMCG demand.

Despite these risks, AMCR offers a compelling risk/reward profile with a 5% dividend yield, 10% free cash flow yield, and strategic positioning that converts scale, sustainability, and healthcare exposure into a resilient, high-return compounder. The combination of synergies, leverage reduction, and market leadership makes the current share price an attractive entry point with significant upside potential.

Previously we covered a bullish thesis on Avery Dennison Corporation (AVY) by Serhio MaxDividends in May 2025, which highlighted the company’s leadership in materials science, digital identification solutions, and reliable dividend track record. The stock has depreciated approximately by 10% since our coverage due to broader market pressures. The thesis still stands as AVY expands its Intelligent Labels segment. SniperPearl shares a similar approach but emphasizes Amcor’s Berry Global merger, scale, healthcare exposure, and synergy-driven upside.

Amcor plc is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 47 hedge fund portfolios held AMCR at the end of the second quarter which was 40 in the previous quarter. While we acknowledge the potential of AMCR as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.