Financial Analysis: Sonoco Products (SON) vs. Its Peers

Sonoco Products (NYSE: SON) is one of 15 public companies in the “Non-Paper Containers & Packaging” industry, but how does it weigh in compared to its rivals? We will compare Sonoco Products to related companies based on the strength of its risk, profitability, valuation, dividends, analyst recommendations, earnings and institutional ownership.

Dividends

Sonoco Products pays an annual dividend of $1.56 per share and has a dividend yield of 2.9%. Sonoco Products pays out 57.4% of its earnings in the form of a dividend. As a group, “Non-Paper Containers & Packaging” companies pay a dividend yield of 2.2% and pay out 64.5% of their earnings in the form of a dividend. Sonoco Products has raised its dividend for 37 consecutive years. Sonoco Products is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Profitability

This table compares Sonoco Products and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sonoco Products 5.63% 16.40% 6.38%
Sonoco Products Competitors 2.82% 22.99% 4.08%

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Sonoco Products and its rivals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sonoco Products 0 5 2 0 2.29
Sonoco Products Competitors 93 604 410 6 2.30

Sonoco Products presently has a consensus price target of $53.00, indicating a potential downside of 2.20%. As a group, “Non-Paper Containers & Packaging” companies have a potential upside of 1.60%. Given Sonoco Products’ rivals stronger consensus rating and higher probable upside, analysts clearly believe Sonoco Products has less favorable growth aspects than its rivals.

Institutional & Insider Ownership

72.0% of Sonoco Products shares are owned by institutional investors. Comparatively, 75.4% of shares of all “Non-Paper Containers & Packaging” companies are owned by institutional investors. 1.9% of Sonoco Products shares are owned by insiders. Comparatively, 7.1% of shares of all “Non-Paper Containers & Packaging” companies are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Risk & Volatility

Sonoco Products has a beta of 1.15, suggesting that its stock price is 15% more volatile than the S&P 500. Comparatively, Sonoco Products’ rivals have a beta of 1.21, suggesting that their average stock price is 21% more volatile than the S&P 500.

Valuation & Earnings

This table compares Sonoco Products and its rivals top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Sonoco Products $4.78 billion $286.43 million 19.92
Sonoco Products Competitors $4.42 billion $182.22 million 151.53

Sonoco Products has higher revenue and earnings than its rivals. Sonoco Products is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Summary

Sonoco Products rivals beat Sonoco Products on 9 of the 15 factors compared.

About Sonoco Products

Sonoco Products Company is engaged in manufacturing of industrial and consumer packaging products, and providing packaging services. The Company operates in four segments: Consumer Packaging, Paper and Industrial Converted Products, Display and Packaging, and Protective Solutions. Its Consumer Packaging segment’s products and services include round composite cans, aluminum, steel and peelable membrane easy-open closures for composite and metal cans; plastic bottles, cups and trays, and printed flexible packaging and global brand management. The Display and Packaging segment’s products and services include point-of-purchase displays; fulfilment; supply chain management, and paperboard specialties. Its Paper and Industrial Converted Products segment provides the raw material for its fiber-based packaging. The Protective Solutions segment’s products and services include custom-engineered and expanded foam protective packaging and components, and temperature-assured packaging.

Receive News & Ratings for Sonoco Products Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Sonoco Products and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply