Here’s why Amcor (ASX:AMC) shares remain a high conviction position for this top fund manager


The Amcor Limited (ASX:AMC) share price fell 5 per cent in August after announcing a major acquisition and earnings and dividends in line with last year.

Writing it its August 2018 monthly update, the Firetrail Absolute Return Fund said Amcor remains a high conviction position as it still sees significant valuation upside and strong earnings growth.

The fund’s thesis for Amcor shares includes the packaging company’s acquisitive growth strategy, including the $US6.8 billion acquisition of US rival Bemis Inc.

According to Firetrail, Amcor and Bemis are a highly synergistic combination, with the merged companies now in a position to be the largest flexible packaging producer across both Europe and North America.

The fund says this gives Amcor significantly increased power with their major customers as well as a chance to increase production efficiencies in their plants. The fund met with Amcor management post results and its view of the Bemis acquisition has strengthened further.

Amcor is in the fund’s top three overweigh positions, along with Clydesdale Bank and Reliance Worldwide (ASX:RWC).

The Amcor share price has fallen from over $15 in early August to trade at $13.63. Amcor shares trade at around 15.7 times earnings and a dividend yield of around 4.6 per cent.

Contributors to this article may own shares in some of the companies mentioned in this article. The Capital Club has a thorough disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
Bruce Jackson has 30 years of hands on investing experience. He is passionate about stock market investing, running his own portfolio and SMSF. His focus is on small cap growth stocks. You can contact Bruce at