WestRock upgraded to Buy at Argus on further Smurfit Kappa synergies

As previously reported, Argus upgraded WestRock (WRK) to Buy from Hold with a $42 price target. The stock has outperformed the broader market over the past three months with a 15% gain, while its management has signaled confidence in its outlook with a double-digit dividend hike, the analyst tells investors in a research note. WestRock is due to merge with Smurfit Kappa (SMFKY) next year, and further synergies are envisioned, Argus states, adding that the current valuation multiple on the stock is also “attractive” as its current price/sales ratio of 0.5 is near the low end of the historical range of 0.4-1.0 and its price/book ratio of 1.0 is below the midpoint of the historical range of 0.7-1.4.