Stock Analysis | Amcor Outlook - Bearish Technicals Overshadow Mixed Analysts and Strong Fund Flows

1. Market Snapshot

Takeaway: Amcor (AMCR) is currently under pressure from weak technical signals, with an internal diagnostic score of just 1.8 and three bearish indicators, while institutional fund flows show a positive trend with a score of 7.95.

2. News Highlights

Recent news for Amcor includes a strategic partnership with Origin Materials for sustainable PET bottle caps, positioning the company as a player in the growing eco-conscious packaging sector. Additionally, a report from ResearchAndMarkets highlights the rising value of the hazardous materials packaging industry, which could benefit Amcor’s broader packaging operations. However, the news was mixed with a report showing negative earnings from some of Amcor’s peers in the sector.

3. Analyst Views & Fundamentals

Amcor has drawn mixed views from analysts in the last 20 days, with a simple average rating of 4.67 and a performance-weighted rating of 1.07, indicating a generally bearish outlook when accounting for historical accuracy. There's also a clear disagreement among analysts, with two "Strong Buy" ratings and one "Buy," while the broader stock price is currently down -1.03%, aligning with the lower-weighted rating.

Key fundamentals for Amcor include a ROE of 9.36% (internal diagnostic score 5.11), net operating cash flow of 2.41% of revenue (score 5.11), and a total operating revenue growth rate of -1.49% (score 3.00). These mixed fundamentals suggest modest operational strength but weak revenue growth.

4. Money-Flow Trends

Amcor is experiencing strong positive inflows, particularly among large and extra-large institutional investors. The block inflow ratio is 50.10%, with large inflow at 49.92% and extra-large inflow at 50.16%. Retail and small investors, however, are showing weaker inflow tendencies, with a small inflow ratio of 49.54%, indicating diverging behavior between institutional and retail money flows.

5. Key Technical Signals

Amcor’s technical profile is currently bearish, with three bearish indicators and no bullish ones. The Williams %R (WR) Oversold indicator has an internal diagnostic score of 3.01, suggesting some short-term buying interest, while the MACD Death Cross and MACD Golden Cross both carry scores of 1.35 and 1.00, respectively, reinforcing the bearish bias.

Recent chart signals include a MACD Golden Cross on July 23, followed by WR Oversold readings on July 31 and August 1. These mixed signals suggest a generally weak momentum, with three bearish indicators dominating over the neutral and bearish readings.

6. Conclusion

Amcor is facing a challenging outlook with weak technical signals and mixed analyst views. While institutional money is flowing in, the broader trend remains bearish. Investors may want to consider waiting for a pull-back or clearer momentum before committing. Keep an eye on the upcoming fundamental developments and any new strategic moves in sustainable packaging, which could shift the narrative.