Barclays expects European packaging to face weaker demand amid tariffs

Smurfit WestRock

07/04/2025 10:31

** 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 STERV.HE and Holmen HOLMb.ST, 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 SWR.L 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 risk

COMPANY
NEW RATING
OLD RATING
NEW PT
OLD PT
Holmen HOLMb.ST
underweight
equal weight
SEK 350.00
SEK 420.00
Mondi MNDI.L
equal weight
underweight
1,100p
1,110p
Stora Enso STERV.HE
underweight
overweight
EUR 7.5
EUR 11.50

(Reporting by Vera Dvorakova)

((vera.dvorakova@thomsonreuters.com))