Strategic Positioning and Financial Outlook Drive Buy Rating for Sonoco Products

Wells Fargo analyst Gabrial Hajde maintained a Buy rating on Sonoco Products (SON – Research Report) yesterday and set a price target of $55.00.

Gabrial Hajde has given his Buy rating due to a combination of factors that highlight Sonoco Products’ strategic positioning and financial outlook. The company is nearing the completion of its portfolio simplification process, which has positioned it as a leader in the metal food can business and URB-related products. This strategic focus is expected to enhance its competitive edge and improve its risk/reward profile.
Additionally, the integration of Eviosys and the strategic review of ThermoSafe are pivotal in optimizing Sonoco’s cost structure and reducing leverage. The anticipated divestment of ThermoSafe and the synergies from Eviosys are projected to significantly lower the company’s debt levels, aligning with its leverage targets. These strategic moves, coupled with favorable market conditions such as the price hike in rigid paper containers, underpin the positive outlook for Sonoco Products.

Based on the recent corporate insider activity of 36 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of SON in relation to earlier this year.