CCL Industries (CCDBF) AI Stock Analysis

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Positive Factors

Business Model

CCL's resilient and diverse business model highlights its ability to manage through challenging market backdrops and seek out pockets of growth.

Competitive Position

CCL's competitive position as the world's largest label converter with a global network of plants and profitable expansion into materials science supports its outperform rating.

Financial Position

CCL remains well positioned and is one of the only players in the industry that has the financial wherewithal to take advantage of and benefit from many trends in the label industry.

Negative Factors

CCL Industries (CCDBF) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$10.04B

Dividend Yield1.5%

Average Volume (3M)14.30K

Price to Earnings (P/E)16.4

Beta (1Y)0.45

Revenue GrowthN/A

EPS GrowthN/A

CountryUS

Employees26,300

SectorConsumer Cyclical

Sector Strength63

IndustryPackaging & Containers

Share Statistics

EPS (TTM)0.84

Shares Outstanding163,814,540

10 Day Avg. Volume24,348

30 Day Avg. Volume14,305

Financial Highlights & Ratios

PEG Ratio7.58

Price to Book (P/B)2.52

Price to Sales (P/S)0.00

P/FCF Ratio20.97

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$65.92

Price Target Upside15.63% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering7

CCL Industries Business Overview & Revenue Model

Company DescriptionCCL Industries Inc. engages in manufacture and sale of labels, and provides media and software solutions. It operates through four segments: CCL, Avery, Checkpoint, and Innovia. The CCL segment offers pressure sensitive and extruded film materials for decorative, instructional, security, and functional applications in the consumer packaging, healthcare, chemicals, consumer durables, electronic device, and automotive markets. This segment also provides extruded and labeled plastic tubes, aluminum aerosols and specialty bottles, folded instructional leaflets, precision decorated and die cut components, electronic displays, polymer banknote substrate, and other complementary products and services. The Avery segment offers printable media products, including address and shipping labels, marketing and product identification labels, indexes and dividers, business cards, and name badges supported by customized software solutions; and organizational products, such as binders, sheet protectors, and writing instruments. This segment also provides direct to consumer digitally imaged media products, such as labels, business cards, name badges, and family oriented identification labels supported by unique web-enabled e-commerce URLs. The Checkpoint segment offers technology-driven loss-prevention, inventory management, and labelling solutions, including radio frequency and radio-frequency identification solutions to retail and apparel industries. The Innovia segment provides specialty, high-performance, multi-layer, and surface engineered biaxially oriented polypropylene films for pressure sensitive label materials, flexible packaging, and consumer packaged goods industries. It operates in Canada, the United States, Puerto Rico, Latin America, Europe, Asia, Africa, and Australia. The company was founded in 1951 and is headquartered in Toronto, Canada.

How the Company Makes Money

CCL Industries Earnings Call Summary

Earnings Call Date:May 07, 2025

(Q1-2025)

% Change Since: 9.45%|

Next Earnings Date:Aug 06, 2025

Earnings Call Sentiment Positive

The earnings call presented a generally positive picture, with significant sales growth, record earnings per share, and improved free cash flow. However, challenges such as increased corporate expenses, net debt rise, and uncertainties in the Avery segment due to tariffs and the back-to-school season were noted.

Q1-2025 Updates

Positive Updates

Sales Increase

Sales increased by 8.6% in Q1 2025, reaching $1.89 billion compared to $1.74 billion in Q1 2024.

Operating Income Growth

Operating income increased by 9%, reaching $316.9 million compared to $282 million in Q1 2024.

Record Earnings Per Share

Adjusted basic earnings per Class B share reached a record $1.18, up from $1.08 in Q1 2024.

Strong Free Cash Flow Improvement

Free cash flow from operations was an inflow of $39.1 million compared to an outflow of $7 million in Q1 2024.

Share Repurchase and Dividend Increase

The company repurchased 1.4 million shares for $100 million, and dividends increased by 10.3%.

Innovia Segment Performance

Innovia segment showed strong volume growth and share gain, especially in North America.

Negative Updates

Increased Corporate Expenses

Corporate expenses were up due to higher variable compensation expense and other general items.

Net Debt Increase

Net debt increased by $134 million to $1.75 billion as of March 31, 2025.

Checkpoint Segment Challenges

Declines in Checkpoint segment in regions like the Americas, offsetting strong performance in Europe.

Avery Segment Uncertainty

Uncertainty in the U.S. back-to-school season could impact Avery's performance.

Tariff Impact Concerns

Concerns about tariffs affecting the Avery segment, particularly regarding ring binder products.

Company Guidance

In the first quarter of 2025, CCL Industries reported an 8.6% increase in sales, reaching $1.89 billion compared to $1.74 billion in the same period in 2024. This growth was driven by 3.8% organic growth, 1.4% from acquisitions, and a positive 3.4% impact from foreign currency translation. Operating income rose to $316.9 million, marking a 9% increase from the previous year's $282 million, excluding currency translation effects. The company's net earnings improved by 6% to $207.4 million, and basic earnings per Class B share reached a record high of $1.18, up from $1.08. Free cash flow from operations was a positive $39.1 million, a significant turnaround from the $7 million outflow in Q1 2024. The company also repurchased 1.4 million shares for $100 million and increased its annual dividend by 10.3%, resulting in $156.3 million returned to shareholders. Net debt increased to $1.75 billion, with a leverage ratio of 1.14 times, demonstrating a strong balance sheet despite higher corporate expenses and finance costs.

CCL Industries Financial Statement Overview

Summary

CCL Industries showcases strong financial performance with robust revenue and profit growth, impressive profitability margins, and a solid balance sheet. The company's effective cash flow management supports its strategic growth initiatives. While leverage exists, it is mitigated by substantial equity backing, ensuring financial stability.

Income Statement

Very Positive

CCL Industries has demonstrated robust revenue growth with a notable increase from previous years, reaching $7.39 billion in the TTM period. The gross profit margin stands strong at 29.67%, and the net profit margin is impressive at 11.61%. EBIT and EBITDA margins are healthy at 14.83% and 22.10%, respectively, indicating efficient cost management and operational excellence. The company has shown consistent revenue growth, enhancing its profitability and market position.

Balance Sheet

Positive

The company maintains a solid balance sheet with a debt-to-equity ratio of 0.47, reflecting a prudent approach to leverage. The equity ratio of 53.54% signifies strong equity backing and financial stability. Return on equity is commendable at 15.73%, showcasing effective utilization of shareholder funds. Despite the presence of substantial debt, the company's equity position provides a buffer against potential financial risks.

Cash Flow

Positive

CCL Industries exhibits a healthy cash flow with operating cash flow exceeding net income, indicating strong cash generation efficiency. The free cash flow growth rate is solid, and the free cash flow to net income ratio is 0.76, suggesting effective capital expenditure management. The company's ability to generate free cash flow consistently supports its strategic initiatives and growth plans.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
7.39B	7.25B	6.65B	6.38B	5.73B	5.24B
	Gross Profit
2.19B	2.14B	1.91B	1.72B	1.59B	1.50B
	EBIT
1.10B	1.06B	928.80M	895.40M	849.60M	787.30M
	EBITDA
1.63B	1.58B	1.25B	1.26B	1.19B	1.09B
	Net Income Common Stockholders
858.40M	843.10M	530.20M	622.70M	599.10M	529.70M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
821.00M	820.60M	774.20M	831.50M	594.10M	700.30M
	Total Assets
10.19B	9.86B	8.92B	8.66B	7.63B	7.34B
	Total Debt
2.57B	2.45B	2.28B	2.36B	1.85B	2.09B
	Net Debt
1.75B	1.63B	1.52B	1.53B	1.26B	1.39B
	Total Liabilities
4.74B	4.58B	4.30B	4.40B	3.88B	4.05B
	Stockholders Equity
5.46B	5.28B	4.62B	4.27B	3.75B	3.28B
Cash Flow		Free Cash Flow
648.10M	601.90M	541.70M	545.60M	514.90M	600.10M
	Operating Cash Flow
1.05B	1.06B	1.00B	992.80M	838.70M	882.90M
	Investing Cash Flow
-535.70M	-600.30M	-768.00M	-706.60M	-541.30M	-428.00M
	Financing Cash Flow
-463.20M	-424.30M	-295.20M	-72.60M	-370.00M	-461.30M

CCL Industries Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CCDBF		$10.04B	16.39	16.78%	1.50%	―	―
WPK	78 Outperform	C$2.79B	13.77	11.26%	0.40%	5.50%	9.93%
TCL.B	77 Outperform	C$1.76B	9.84	9.65%	4.28%	-2.58%	100.21%
TCL.A	76 Outperform	C$1.76B	9.88	9.65%	4.26%	-2.58%	100.21%
IFX	75 Outperform	C$71.88M	12.23	9.56%	―	13.92%	310.18%
Sector *	62 Neutral	$6.88B	11.32	2.95%	3.87%	2.70%	-24.57%
CADNF		$671.13M	―	-0.24%	5.21%	―	―

* Consumer Cyclical Sector Average

Performance Comparison

CCDBF

CCL Industries

57.01

5.78

11.28%

TSE:IFX

Imaflex

1.38

0.33

31.43%

TSE:TCL.A

Transcontinental

21.11

7.69

57.30%

TSE:TCL.B

Transcontinental Inc. Class B

21.02

7.63

56.98%

TSE:WPK

Winpak

45.33

3.05

7.21%

CADNF

Cascades

6.58

0.08

1.23%

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.