Orora (ASX:ORA) is facing tough conditions in the spirits market with persistent cyclical pressures and structural uncertainty weighing on its French business, Saverglass, Jefferies said in a note on Thursday.

The investment firm cut its EPS forecast for fiscal 2027 and 2028 by 9% and 16%, respectively, citing weaker pricing due to de-premiumization and softer volumes in North America amid continued weakness in demand for spirits.

Jefferies does not expect the pricing pressure and negative mix impacts to stabilize until the second half of fiscal 2027. It also expects Saverglass revenue to decline by 4% in 2027.

The glass maker is also reeling with residual cash impacts in light of the Middle East conflict, as its Ras Al Khaimah facility remains offline. While hedges against energy prices are set to roll off in the second half of 2027, which could lead to higher costs.

"We see better value elsewhere," analysts at Jefferies said.

The brokerage maintained a hold rating and lowered its price target to AU$1.34 from AU$1.69.