HARTFORD, Conn. (AP) ¿ Profit growth at specialty packaging companies is expected to lag other companies as the economy recovers next year, an analyst said Friday as he downgraded the sector. Goldman Sachs analyst Richard Skidmore lowered his rating to "Neutral" from "Attractive." Growth in earnings per share for packaging companies is expected to lag the Standard & Poor's 500 index next year because the sector's food and beverage markets will improve more slowly than other businesses as the economy improves, Skidmore said in a note to investors. Food and beverage markets did not experience the downturn last year "and therefore, we do not expect will experience a sharp upturn as the economy recovers," he said. Skidmore cut his rating for packaging-products maker Sealed Air Corp. of Elmwood Park, N.J., to "Sell" from "Neutral" and downgraded Philadelphia-based Crown Holdings Inc., which makes food and drink packaging, to "Neutral" from "Buy." He raised his 2010 earnings estimates for Bway Holding Co., an Atlanta-based supplier of metal and plastic containers to $1.25 per share from $1.15 per share and increased his 2011 estimate and to $1.50 per share $1.25 per share. He said expects stronger recovery in paint cans than he previous believed.
Skidmore also cut his estimates for Silgan Holdings Co. to reflect higher interest expense following refinancing. He estimates 2009 earnings will be $3.60 per share, down from $3.75 per share. He expects $3.95 per share next year, down from $4.10 per share, and $4.05 per share in 2011, down from $4.20 per share. He reiterated a "Buy" rating for Owens-Illinois Inc., a Perrysburg, Ohio, manufacturer of glass bottles for beer, wine and soft drinks. Skidmore said he sees more opportunities for a cyclical rebound in Owens-Illinois' glass volumes and its ability to raise prices next year after shutting plants in North America. Shares of Crown Holdings fell 80 cents, or 3.3 percent, to $23.41 in morning trading. Sealed Air dropped 55 cents, or 2.7 percent, to $19.58 and Owens-Illinois rose 76 cents, or 2.8 percent, to $28.44. Silgan fell 9 cents, to $43.96 and Bway rose 63 cents, or 4.6 percent, to $14.20.