Sonoco Products (SON) AI Stock Analysis

• Market Cap: $4.55B
• Dividend Yield: 4.55%
• Average Volume (3M): 932.73K
• Price to Earnings (P/E): 31.0
• Beta (1Y): 0.64
• Revenue Growth: 0.90%
• EPS Growth: -118.86%
• Country: US
• Employees: 23,400
• Sector: Consumer Cyclical
• Sector Strength: 81
• Industry: Packaging & Containers
• EPS (TTM): 1.37
• Shares Outstanding: 98,631,070
• 10 Day Avg. Volume: 1,014,748
• 30 Day Avg. Volume: 932,734
• PEG Ratio: -0.45
• Price to Book (P/B): 2.12
• Price to Sales (P/S): 0.91
• P/FCF Ratio: 10.94
• Enterprise Value/Market Cap: 2.15
• Enterprise Value/Revenue: 1.73
• Enterprise Value/Gross Profit: 8.12
• Enterprise Value/Ebitda: 13.61
• 1Y Price Target: $55.60
• Price Target Upside: 21.66% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 67 Neutral
• Price Target: $50.00 ▲(9.41% Upside)

Sonoco Products' strong financial performance and positive earnings call are significant strengths. However, valuation concerns and neutral technical indicators moderate the overall score. The company's ability to manage macroeconomic challenges and leverage effectively will be crucial for future success.

Positive Factors

Debt Reduction

Proceeds from the divestiture are earmarked for reducing debt towards management's target, which is seen favorably.

Earnings Potential

Maintaining a Buy rating on Sonoco is supported by valuation and potential catalysts from its portfolio transformation.

Market Position

The portfolio has been reshaped from being a collection of smaller businesses to one with two primary businesses with significant market share and a clear right to win in their respective markets.

Negative Factors

Growth and EBITDA Uncertainty

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

Higher Interest Expenses

Guidance for EPS and operating cash flow was trimmed due to higher interest expenses.

Leverage Concerns

The transaction moves Sonoco's net leverage ratio to a higher level than current consensus estimates.

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 generates revenue through multiple key streams, primarily by manufacturing and selling a diverse range of packaging products and services. The company's revenue model includes sales from consumer packaging, which encompasses flexible and rigid packaging solutions, and industrial products, such as paperboard tubes and cores. Additionally, Sonoco earns revenue from its protective solutions segment, which provides packaging that safeguards products during shipping and handling. Significant partnerships with notable companies in various industries help secure long-term contracts and consistent revenue. The company's focus on innovation and sustainability also attracts customers seeking eco-friendly packaging solutions, further enhancing its profitability.

Sonoco Products Financial Statement Overview

Summary

Sonoco Products shows moderate financial performance with stable revenue growth but low profitability margins. The high debt-to-equity ratio indicates leverage concerns, while cash flow management reveals 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	5.66B	5.31B	5.44B	5.86B	5.59B	5.24B
Gross Profit	1.20B	1.14B	1.20B	1.23B	1.06B	1.05B
EBITDA	718.37M	610.97M	965.41M	869.63M	148.19M	591.93M
Net Income	555.81M	163.95M	474.96M	466.44M	-85.48M	207.46M
Balance Sheet
Total Assets	11.97B	12.51B	7.19B	7.05B	5.07B	5.28B
Cash, Cash Equivalents and Short-Term Investments	329.80M	431.01M	138.90M	227.44M	170.98M	564.85M
Total Debt	705.06M	7.30B	3.23B	3.47B	1.84B	1.96B
Total Liabilities	8.72B	10.22B	4.76B	5.02B	3.22B	3.37B
Stockholders Equity	3.25B	2.27B	2.42B	2.07B	1.84B	1.91B
Cash Flow
Free Cash Flow	143.77M	440.61M	519.84M	189.90M	55.82M	521.96M
Operating Cash Flow	543.70M	833.85M	882.92M	509.05M	298.67M	705.62M
Investing Cash Flow	-2.36B	-4.11B	-619.34M	-1.75B	-173.49M	-127.01M
Financing Cash Flow	2.07B	3.67B	-351.99M	1.33B	-513.54M	-162.87M

Sonoco Products Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 45.70
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 45.7 is below the 20-day moving average (MA) of 46.34, below the 50-day MA of 45.95, and below the 200-day MA of 45.77, indicating a bearish trend. The MACD of 0.09 indicates Positive momentum. The RSI at 46.83 is Neutral, neither overbought nor oversold. The STOCH value of 48.53 is Neutral, 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
REYN	73 Outperform	$5.00B	16.10	14.85%	3.99%	-0.49%	-13.92%
GPK	67 Neutral	$6.38B	12.19	17.71%	2.04%	-5.05%	-24.52%
SON	67 Neutral	$4.55B	30.97	3.98%	4.55%	0.90%	-118.86%
SEE	65 Neutral	$4.82B	16.05	37.35%	2.40%	-2.00%	-18.50%
Sector *	61 Neutral	$18.02B	12.77	-0.74%	3.01%	1.30%	-13.03%
SLGN	61 Neutral	$4.83B	16.04	14.54%	1.78%	5.49%	-1.01%
AMBP	58 Neutral	$2.14B	―	-69.06%	11.40%	8.39%	72.18%

Sonoco Products Corporate Events

Sonoco Products Sells ThermoSafe Unit for $725 Million

On September 7, 2025, Sonoco Products Company announced the sale of its ThermoSafe business unit to Arsenal Capital Partners for up to $725 million. This transaction is part of Sonoco’s strategy to streamline its operations into two core global business segments, with the proceeds expected to reduce existing debt and support the company’s portfolio simplification and organizational streamlining efforts.

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.