Why has the global packaging company share price been so volatile since May?
The post The Amcor (ASX:AMC) share price has struggled since May appeared first on The Motley Fool Australia. –
The Amcor Plc (ASX: AMC) share price has been under the pump in the last couple of months. While shares in the global packaging company are up 1.9% since 30 June, it’s been tough going for a couple of months.
Amcor shares surged higher to $16.05 per share on May 7. Since then, investors have watched the shares slide 4% in approximately 10 weeks to $15.41 at Tuesday’s close.
So, what’s driving the current volatility in the Amcor share price?
Why the Amcor share price has struggled since May
Let’s start with why the packaging company’s value jumped in May to start with. The major factor sparking that surge was the release of the group’s third quarter trading results for FY2021.
Amcor announced net income up 47.5% on the prior corresponding period (pcp) to US$267 million for the quarter ended 31 March 2021. For the first 3 quarters combined, net income was up 58% on pcp to US$684 million.
Climbing net sales figures, combined with the falling cost of sales, helped boost earnings and investors spirits. The Amcor share price jumped higher as a result, closing May 7 at $16.05 per share.
However, it’s been largely downhill since then. It’s worth noting that there haven’t been any price-sensitive announcements from the packaging group since May.
That hasn’t stopped investors from selling down in a volatile patch for the packaging group. That means there hasn’t been a clear catalyst for the recent share price softness we’re seeing reflected in Amcor’s valuation.
One factor could be the rise of the Delta strain both across Australia and more generally across the globe. COVID-19 restrictions crimped demand for packaging and strained supply chains when it first broke out in March 2020.
While the Amcor share price has struggled since May, it’s not all bad news for investors. Shares in the packaging group are still up 1.7% year-to-date and flat on a last twelve months basis.
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Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Amcor Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.