01:42 PM EDT, 04/28/2025 (MT Newswires) -- Reynolds Consumer Products ( REYN ) is likely to have a generally stable Q1, with its top-line performance showing improvement despite ongoing challenges, particularly in foam dish sales, RBC Capital Markets said in a report Monday.

"While foam dishes remain a pain point, we think FY'25 guidance reflects some conservatism and would not be surprised to see some better performance from other categories and on the bottom line given ongoing productivity/cost savings initiatives," RBC said.

The company's performance improved in fiscal year 2024, and its fiscal-year 2025 guidance suggests that there is room for revenue upside if macroeconomic conditions remain stable. Despite the challenges facing the tableware segment, particularly foam dish sales due to regulatory changes and shifting consumer preferences, these factors are already factored into the guidance, the report said.

The company faces commodity cost pressures due to rising aluminum tariffs and raw material costs, and while it plans to mitigate this through pricing adjustments and productivity improvements, the brokerage cautions that the current market environment may make price increases challenging, RBC said.

"We continue see REYN's position generally improving," RBC said. However, ongoing pressure on its product categories and a lack of a clear catalyst warrant a cautious stance, it added.

RBC has a sector perform rating on Reynolds Consumer Products ( REYN ) with a price target of $30.

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