Kick Off: Amcor Limited v Brambles Limited

Two heavyweights go head-to-head in this Round 1 battle… the result could surprise you…

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Motley Fool's ASX World Cup series has been nothing short of outstanding so far, and today's match between global packaging group Amcor Limited (ASX: AMC) and pooling solutions company Brambles Limited (ASX: BXB) should be no different.

Both teams come into this tournament with a very similar recent performance. So far in 2014, Amcor's share price has retreated 0.6% while Brambles has gained 0.7%, with both lagging behind the S&P/ASX 200 Index's (Index: ^AXJO) (ASX: XJO) 1% gain. However, there's plenty to like about both entities – it looks set to be a close one!

First, let's take a look at the line-ups:

Amcor Limited Brambles Limited
Code ASX:AMC ASX:BXB
Recent Price $10.46 $9.24
Market Capitalisation $12.6 billion $14.4 billion
Dividend Yield | Franking 3.8% | 0% 2.9% | 30%
Projected P/E ratio 15.7 22

(Source: Morningstar)

Amcor Limited

Amcor has been a long-time crowd favourite, having risen 180% since March 2009. While it let one of its key players in Orora Limited (ASX: ORA) go late last year, it seems to have been the right decision with the company now able to focus on its operations in emerging economies offering greater growth potential. In fact, the company has grown at a compound rate of 18% annually over the last 13 years in these regions. That's an outstanding early goal for Amcor.

The team looks set to benefit as the global economic outlook improves and if the Australian dollar falls versus the US greenback. Better yet, it is trading on a lower P/E ratio than its rival in Brambles and offers a higher dividend yield (albeit unfranked), scoring them another late goal.

Brambles Limited

Like Amcor, Brambles has been a fantastic stock to hold with its price up 128% since March 2009 and, with expanding operations through Europe, the team should continue to go from strength to strength. In April it forecast 7% growth on a constant currency basis for its third quarter which could well be boosted by acquisitions of businesses like Transpac, which it also recently announced.

Brambles is an excellent team. Indeed, with a market capitalisation of $14.4 billion, it is also one of Australia's largest. However, it appears the crowd has already well-and-truly recognised its talent with the stock currently trading on a much higher P/E ratio than Amcor (as well as a lesser dividend yield).

Full-time

There is no questioning the quality of either team but this time around, Amcor managed to get away with a 2-0 win in what was an excellent start to this tournament. Based on its sheer size, impressive history and growth potential Amcor could certainly be a stock to watch for the remainder of this tournament…

Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »