Ricky Sandler’s Eminence Capital’s Top 5 Stocks

4. Berry Global Group, Inc. (NYSE:BERY)

Eminence Capital’s Stake Value: $293,662,000

Percentage of Eminence Capital’s 13F Portfolio: 3.61%

Number of Hedge Fund Holders: 37

Berry Global Group, Inc. (NYSE:BERY) is a packaging company, focused on engineering unique and protective packaging for products, prioritizing sustainable materials wherever feasible. Berry Global Group, Inc. (NYSE:BERY) provides its packaging solutions to the healthcare, cosmetics, food, beverages, and construction sectors, among others. It is one of the top stocks to buy according to Ricky Sandler’s Eminence Capital. 

At the end of Q2, Eminence Capital held 4.5 million shares in Berry Global Group, Inc. (NYSE:BERY), amounting to $293.66 million, making up 3.61% of the firm’s 13F portfolio. 

On October 12, Mizuho analyst Christopher Parkinson kept a Neutral rating on Berry Global Group, Inc. (NYSE:BERY), with a $70 price target. He stated that Berry Global Group, Inc. (NYSE:BERY) has attractive free cash flow and a strong acquisitions portfolio, but investors will gain more confidence in the stock once they observe organic growth in 2022 and 2023. 

Here is what Rhizome Partners has to say about Berry Global Group, Inc. (NYSE:BERY) in their Q4 2020 investor letter:

“Berry Global is the “Rodney Dangerfield” of value investments. The company recently issued $750mm worth of 2026 debt at 1.57% and used the proceeds to pay down higher coupon debt. The spread between the debt and equity yield is about 10%. Something is mispriced. In 2020, Berry had generated “bond-like” cashflows and had paid down almost $1 billion of debt. The market simply yawned. We keep hearing that institutional investors will not touch Berry until it reduces leverage below 4x EBITDA. Perhaps Berry will work like Griffin in that once they reduce leverage below 4x and starts to show 4-6 quarters of 2% organic growth, the shares may move “violently” to the upside.”