Bank of America announced on Thursday that it had resumed coverage of Verallia shares, with a Buy recommendation and a price target of 43 euros.

In a research note, the American bank stresses that the European leader in glass packaging is benefiting from buoyant winds over the long term with the end of plastic products, a market estimated at $300 billion.

According to the firm, demand for glass packaging should thus grow by 2% to 3% per year in Europe.

BofA, which highlights Verallia's 'darling' status in terms of ESG issues, says it expects Ebitda to be 6% to 8% above consensus for fiscal 2023 and 2024.

The bank adds that Verallia's share price is based on an Enterprise Value/Ebitda ratio of around 4.7x by 2024, showing a discount to its peers (6.5-7x) despite higher margins.

BofA says it has added the stock to its list of best investment ideas for small and mid-caps.

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