Sonoco Products (SON) AI Stock Analysis

• Market Cap: $4.25B
• Dividend Yield: 4.92%
• Average Volume (3M): 640.38K
• Price to Earnings (P/E): 28.0
• Beta (1Y): 0.60
• Revenue Growth: -4.58%
• EPS Growth: -61.14%
• Country: US
• Employees: 23,400
• Sector: Consumer Cyclical
• Sector Strength: 58
• Industry: Packaging & Containers
• EPS (TTM): 1.38
• Shares Outstanding: 98,627,980
• 10 Day Avg. Volume: 664,143
• 30 Day Avg. Volume: 640,377
• PEG Ratio: -4.19
• Price to Book (P/B): 1.73
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 70.12
• Enterprise Value/Market Cap: 1.53
• Enterprise Value/Revenue: 0.28
• Enterprise Value/Gross Profit: 5.62
• Enterprise Value/Ebitda: 2.17
• 1Y Price Target: $56.57
• Price Target Upside: 31.41% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8

• Rating: 68 Neutral
• Price Target: $49.00 ▲(13.82%Upside)

Sonoco Products' overall score is driven by strong financial performance and strategic corporate actions, including effective debt reduction and focused business realignment. However, technical analysis indicates potential market challenges, while valuation metrics suggest the stock might be overvalued despite a good dividend yield.

Positive Factors

Debt Management

Leverage is set to return to approximately 3x by late-2025 due to solid returns on Sonoco's divested plastics businesses, indicating financial stability.

Leadership Changes

Naming a permanent CFO removes a small overhang as investors awaited certainty on this important open role.

Portfolio Transformation

SON has spent several years simplifying its business structure and product portfolio, focusing on its two main product areas where it is the global leader.

Negative Factors

Economic Challenges

The Industrial business could be pressured with slowing economic activity, impacting growth.

Growth Uncertainty

There are questions around growth and EBITDA of the new portfolio, particularly at the new European food can business.

Leverage Concerns

The company's leverage is higher than it has maintained in the past, with 2025 leverage estimated at around 4.0x.

Sonoco Products Business Overview & Revenue Model

Company Description

Sonoco Products Company, together with its subsidiaries, manufactures and sells industrial and consumer packaging products in North and South America, Europe, Australia, and Asia. The company operates through two segments: Consumer Packaging and Industrial Paper Packaging. The Consumer Packaging segment round and shaped rigid paper containers; metal and peelable membrane ends and closures; thermoformed plastic trays and containers; printed flexible packaging; and global brand artwork management. The Industrial Paper Packaging segment provides fiber-based tubes, cones, and cores; fiber-based construction tubes; fiber-based protective packaging and components; wooden, metal, and composite wire and cable, as well as reels and spools; and recycled paperboard, corrugating medium, recovered paper, and material recycling services. Sonoco Products Company offers thermoformed rigid plastic trays and devices; custom-engineered molded foam protective packaging and components; temperature-assured packaging; injection molded and extruded containers, spools, and parts; retail security packaging, including printed backer cards, thermoformed blisters, and heat-sealing equipment; and paper amenities. The company sells its products in various markets, which include paper, textile, film, food, chemical, packaging, construction, and wire and cable. Sonoco Products Company was founded in 1899 and is headquartered in Hartsville, South Carolina.

How the Company Makes Money

Sonoco Products Company generates revenue through the sale of its diverse range of packaging products and services. Its primary revenue streams include consumer packaging, which covers rigid paper and plastic containers, flexible packaging, and closures. The industrial products segment includes tubes, cores, and paper-based engineered carriers. Protective solutions provide custom-engineered protective packaging solutions. Additionally, Sonoco offers supply chain management services. The company's earnings are bolstered by long-term customer relationships and strategic partnerships in various industries, which facilitate steady demand for its products. Sonoco's focus on sustainability and innovation also plays a critical role in enhancing its market position and profitability.

Sonoco Products Financial Statement Overview

Summary

Sonoco Products demonstrates a solid financial foundation with areas for improvement. Revenue growth is a positive indicator, but profitability margins and leverage levels present potential risks. Cash flow management shows mixed results, with strong operational cash generation but limited free cash flow.

Income Statement

Sonoco Products shows moderate performance in revenue growth and profitability. The TTM data indicates a gross profit margin of 33.72% and net profit margin of 2.40%, reflecting a stable but low profitability profile. Revenue growth from the previous period is notable, signaling positive momentum. However, the EBIT margin of 5.97% and EBITDA margin of 8.87% suggest room for improvement in operational efficiency.

Balance Sheet

The balance sheet presents a mixed financial position. The debt-to-equity ratio is relatively high at 98.52%, signaling potential leverage concerns. Return on equity stands at 6.22%, indicating moderate returns for shareholders. The equity ratio of 19.41% highlights a lower reliance on equity financing, which could increase financial risk.

Cash Flow

Cash flow analysis reveals challenges in free cash flow generation with a recent decrease. The operating cash flow to net income ratio of 3.00 is strong and indicates efficient cash generation from operations. However, the free cash flow to net income ratio of 0.40 shows limited free cash flow relative to earnings, suggesting constraints on liquidity and reinvestment capacity.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
5.38B	5.31B	5.44B	5.86B	5.59B	5.24B
	Gross Profit
1.16B	1.14B	1.20B	1.23B	1.06B	1.05B
	EBIT
340.99M	326.58M	589.05M	563.36M	486.85M	357.80M
	EBITDA
653.75M	610.97M	965.41M	869.63M	148.19M	591.93M
	Net Income Common Stockholders
153.20M	163.95M	474.96M	466.44M	-85.48M	207.46M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
181.83M	431.01M	151.94M	227.44M	170.98M	564.85M
	Total Assets
12.68B	12.51B	7.19B	7.09B	5.09B	5.28B
	Total Debt
2.43B	7.30B	3.35B	3.47B	1.61B	1.70B
	Net Debt
2.24B	6.87B	3.20B	3.25B	1.44B	1.14B
	Total Liabilities
10.22B	10.22B	4.76B	5.02B	3.22B	3.37B
	Stockholders Equity
2.46B	2.27B	2.42B	2.07B	1.85B	1.91B
Cash Flow		Free Cash Flow
60.56M	440.61M	519.84M	189.90M	55.82M	521.96M
	Operating Cash Flow
459.52M	833.85M	882.92M	509.05M	298.67M	705.62M
	Investing Cash Flow
-4.11B	-4.11B	-619.34M	-1.75B	-173.49M	-127.01M
	Financing Cash Flow
3.73B	3.67B	-351.99M	1.33B	-513.54M	-162.87M

Sonoco Products Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 43.05
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SON, the sentiment is Negative. The current price of 43.05 is below the 20-day moving average (MA) of 45.05, below the 50-day MA of 44.63, and below the 200-day MA of 47.77, indicating a bearish trend. The MACD of -0.35 indicates Positive momentum. The RSI at 38.43 is Neutral, neither overbought nor oversold. The STOCH value of 1.05 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SON.

Sonoco Products Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SLGN	74 Outperform	$5.77B	19.99	14.52%	1.48%	1.99%	-5.30%
REYN	73 Outperform	$4.50B	13.45	16.30%	4.30%	-0.97%	1.45%
SON	68 Neutral	$4.25B	27.98	5.54%	4.92%	-4.58%	-61.14%
SEE	68 Neutral	$4.46B	14.64	43.40%	2.64%	-2.45%	-16.55%
AMBP	68 Neutral	$2.49B	―	-69.06%	9.59%	4.42%	70.21%
GPK	64 Neutral	$6.38B	10.36	20.62%	2.08%	-6.28%	-7.43%
Sector *	55 Neutral	HK$24.12B	4.36	-1.73%	9.58%	-0.05%	-66.27%

Sonoco Products Corporate Events

Sonoco Products Appoints New Chief Financial Officer

On June 17, 2025, Sonoco Products Company announced the appointment of Paul Joachimczyk as Chief Financial Officer, effective June 30, 2025. Joachimczyk, who has a robust background in financial leadership across various industries, will replace Jerry Cheatham, the Interim CFO. This transition is part of Sonoco’s ongoing transformation efforts, with Joachimczyk expected to drive long-term value for shareholders through sound financial management and strong operating initiatives.

The most recent analyst rating on (SON) stock is a Buy with a $60.00 price target. To see the full list of analyst forecasts on Sonoco Products stock, see the SON Stock Forecast page.

Sonoco Products Sells Packaging Units to TOPPAN

On April 1, 2025, Sonoco Products Company completed the sale of its Thermoformed and Flexibles Packaging business and its global Trident business to TOPPAN Holdings Inc. for $1.8 billion. The proceeds from this transaction will be used to reduce approximately $1.5 billion in debt, allowing Sonoco to focus on its sustainable metal and fiber packaging businesses, thereby improving its financial position and enabling further investments in these areas.