Business
Barclays expects European packaging to face weaker demand amid tariffs
Barclays expects European packaging to face weaker demand amid tariffs
About this update from Holmen Ab Class A
** Barclays expects European consumerboard operations to be loss-making until there are changes to U.S. tariffs** "In the near term, all packaging stocks could see second-order impacts of end-market volume pressure from weaker consumer demand," it says** The broker cuts its 2025 estimates for Stora Enso OMXHEX:STEAV and Holmen OMXSTO:HOLM_A, as it expects material impact on their consumerboard EBIT from the tariffs** The broker sees Stora Enso as "particularly vulnerable", due to the Finnish group's high leverage and start-up of its new consumerboard capacity at Oulu, which Barclays thinks will be hard to fill** Stora may have to sell additional forests or raise equity to reduce its leverage, it adds** However, Barclays expects Smurfit WestRock NYSE:SW to benefit from lower imports from the EU owing to the London-listed group's domestic consumer packaging business in the U.S., despite a near-term recession riskCOMPANYNEW RATINGOLD RATINGNEW PTOLD PTHolmen OMXSTO:HOLM_Aunderweightequal weightSEK 350.00SEK 420.00Mondi LSE:MNDIequal weightunderweight1,100p1,110pStora Enso OMXHEX:STEAVunderweightoverweightEUR 7.5EUR 11.50