Amcor (AMCR) Stock Looks Cheap On Cash Flow But Rich On Earnings

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Amcor has gained 11.7% over the past month, yet there is a clear tension in how the stock is priced, with a Discounted Cash Flow (DCF) intrinsic value estimate pointing to meaningful upside while earnings based multiples suggest the shares are on the expensive side. Recent portfolio moves, such as the sale of ESE World and new partnerships in sustainable and industrial packaging, add fresh context to that split in valuation signals.

The 11.7% return over the past month leaves Amcor trading higher in the short term, so any valuation gap to intrinsic value is now more important to understand. On the supportive side, progress on higher value packaging solutions, including the Kelpi collaboration and equipment wins like the vacuum sealing system at Barra Mansa, can help long term cash flow expectations. However, any misstep in executing disposals or new projects may weigh on margins and reduce that implied upside. Amcor scores 3 out of 6 on our valuation checks, which is a mixed picture rather than a clear bargain or clear overvaluation.

The stock's next move may depend on whether investors give more weight to the intrinsic value estimate that screens Amcor as undervalued by 42.7% or to the richer signals coming from market multiples.

Find out why Amcor's -2.8% return over the last year is lagging behind its peers.

Is Amcor a Bargain on Cash Flow?

The Discounted Cash Flow (DCF) model values Amcor by projecting its future cash flows and discounting them back to today. For Amcor, the model starts from latest twelve month free cash flow of about $815.7 million and assumes these cash flows grow over time rather than shrink, which fits a business built around long lived customer relationships and ongoing packaging demand.

On these assumptions, the DCF model arrives at an estimated intrinsic value of about $75.63 per share, which screens as roughly 42.7% above the current share price. Because the sale of ESE World takes a lower margin activity out of the group, while projects like the Kelpi partnership and the Barra Mansa equipment rollout still sit inside the cash flow stream, the market may be discounting execution risk more heavily than the cash flow model does.

On balance, the Discounted Cash Flow (DCF) work suggests Amcor stock may be undervalued relative to the cash it is expected to generate.

Our Discounted Cash Flow (DCF) analysis suggests Amcor is undervalued by 42.7%. Track this in your watchlist or portfolio, or discover 43 more high quality undervalued stocks.

Story Continues

AMCR Discounted Cash Flow as at Jul 2026

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Amcor.

Has Amcor Run Too Far on Earnings?

The P/E ratio is a useful way to look at Amcor because earnings remain a key reference point for many packaging stocks. Right now Amcor trades on about 29.5x earnings, which is close to the peer average of 29.9x but well above the wider packaging industry average of roughly 15.0x.

According to Simply Wall St's fair P/E estimate of 24.2x, which reflects the company's margins, size and risk profile, Amcor appears on the expensive side, with the current multiple sitting several turns above that reference point. This indicates that investors are already paying a premium for Amcor's earnings, even before considering the DCF work that points to a different message on value.

On this earnings multiple, Amcor stock currently looks overvalued relative to what the fair P/E would suggest.NYSE:AMCR P/E Ratio as at Jul 2026

See what the numbers say about this price — find out in our valuation breakdown.

The Amcor Narrative: What Would Justify Today's Price?

Simply Wall St Narratives for Amcor pick up where this valuation split leaves off by spelling out which paths for Amcor's growth, margins and earnings would need to hold for the stock to be worth materially more or materially less than today's price, and they sit on the company's Community page. Each narrative treats its view of fair value as a thesis about Amcor's business that can be revisited over time, rather than a one off snapshot.

The community is sharply split on Amcor, with one side focused on synergy and cash flow execution while the other keeps coming back to leverage and valuation.

Bull case: 10% undervalued

"The integration of Berry Global with Amcor is expected to yield $650 million in synergies by fiscal 2028, primarily through cost reduction, procurement optimization, and operational efficiencies, which should support sustained EPS and margin expansion..."

Read the full Bull Case to see why Amcor could be undervalued

Bear case: 767% overvalued

"Net leverage of roughly 3.4 times EBITDA is elevated and implies cash flow must prioritize deleveraging over shareholder returns..."

Read the full Bear Case to see why Amcor could be overvalued

Do you think there's more to the story for Amcor? Head over to our Community to see what others are saying!

The Bottom Line

For Amcor, the Discounted Cash Flow (DCF) work points to meaningful intrinsic value upside, while earnings multiples flag the stock as overvalued relative to a fair P/E benchmark and the wider industry. That split largely comes down to whether you put more weight on Amcor's long term cash generation or on what peers are currently trading on and how sentiment prices its growth profile. With broader valuation checks sitting in the middle, the key issue from here is whether Amcor can execute on portfolio changes and projects without eroding margins, turning the current discount into an opportunity rather than a value trap.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include AMCR.

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