Is Ardagh Metal Packaging (AMBP) a Smart Long-Term Buy?

Rhizome Partners, an investment management firm, published its first-quarter 2022 investor letter – a copy of which can be downloaded here. For the first quarter of 2021, Rhizome Partners generated a net loss of 9.9% versus a 4.6% loss for the Standard & Poor’s 500 Index and a 5.3% loss for the National Association of Real Estate Investment Trusts (NAREIT) Index. Try to spend some time looking at the fund’s top 5 holdings to be informed about their best picks for 2022.

In its Q1 2022 investor letter, Rhizome Partners mentioned Ardagh Metal Packaging S.A. (NYSE:AMBP) and explained its insights for the company. Founded in 2021, Ardagh Metal Packaging S.A. (NYSE:AMBP) is a Luxembourg-based metal can manufacturing company with a $3.6 billion market capitalization. Ardagh Metal Packaging S.A. (NYSE:AMBP) delivered a -33.11% return since the beginning of the year, while its 12-month returns are down by -41.07%. The stock closed at $6.04 per share on May 31, 2022.

Here is what Rhizome Partners has to say about Ardagh Metal Packaging S.A. (NYSE:AMBP) in its Q1 2022 investor letter:

“During the quarter, we sold a small amount of Berry Global and reinvested in Ardagh Metal Packaging. Our exposure in Ardagh Metal Packaging has been largely in five-year warrants. We added exposure in the common stock, since the company recently announced the initiation of a sizable dividend in 2022. We like the dividends because they allow us to create our own style of share buybacks. Although Berry Global is cheaper today both on EV/EBITDA and P/FCF basis, the 2024 EV/EBITDA multiple will be roughly the same. We prefer the long-term secular trends, growth rate, and sustainability of aluminum cans over plastic packaging. We believe the market will rightfully reward a higher terminal value to Ardagh Metal Packaging.”

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Our calculations show that Ardagh Metal Packaging S.A. (NYSE:AMBP) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Ardagh Metal Packaging S.A. (NYSE:AMBP) was in 23 hedge fund portfolios at the end of the first quarter of 2022, compared to 30 funds in the previous quarter. Ardagh Metal Packaging S.A. (NYSE:AMBP) delivered a -23.93% return in the past 3 months. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q1 page.

Disclosure: None. This article is originally published at Insider Monkey.