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CCL Industries Inc Class B (TSE:CCL.B)
TSX:CCL.B
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CCL Industries
(TSX:CCL.B)
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Rating:78Outperform
Price Target:
C$89.00
▲(13.75% Upside)
CCL Industries' strong financial performance and balanced earnings outlook are the most significant factors driving the score. The company's effective cash flow management and stable profitability margins support its growth potential. Technical indicators suggest a neutral trend, while valuation metrics indicate the stock is fairly priced. Despite some challenges, such as increased tax rates and tariff impacts, the company maintains a strong market position.
Positive Factors
Revenue Growth
Consistent sales growth, driven by organic and acquisition-related factors, indicates strong market demand and effective business strategies.
Cash Flow Management
Improved cash flow management enhances financial flexibility, supporting future investments and shareholder returns.
Shareholder Returns
Increased dividends and share repurchases reflect strong financial health and commitment to returning value to shareholders.
Negative Factors
High Effective Tax Rate
A higher tax rate reduces net earnings, potentially impacting profitability and cash available for reinvestment and dividends.
Impact of Tariffs
Tariff impacts increase costs, potentially affecting pricing strategies and margins in affected segments.
Net Debt Increase
Rising net debt levels can strain financial resources, limiting flexibility for future investments and increasing interest obligations.
CCL Industries (CCL.B) vs. iShares MSCI Canada ETF (EWC)
Market Cap
$14.13B
Dividend Yield1.61%
Average Volume (3M)331.30K
Price to Earnings (P/E)18.1
Beta (1Y)0.66
Revenue Growth7.90%
EPS Growth19.55%
CountryCA
Employees26,300
SectorConsumer Cyclical
Sector Strength84
IndustryPackaging & Containers
Share Statistics
EPS (TTM)1.22
Shares Outstanding162,644,560
10 Day Avg. Volume260,289
30 Day Avg. Volume331,295
Financial Highlights & Ratios
PEG Ratio0.27
Price to Book (P/B)2.50
Price to Sales (P/S)1.82
P/FCF Ratio21.89
Enterprise Value/Market Cap1.11
Enterprise Value/Revenue2.09
Enterprise Value/Gross Profit7.00
Enterprise Value/Ebitda10.44
Forecast
1Y Price Target
$93.19Price Target Upside19.11% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
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 MoneyCCL Industries generates revenue primarily through the sale of its products across its three main segments: Label Solutions, Container Solutions, and Product Decorating. The Label Solutions segment is the largest revenue contributor, focusing on pressure-sensitive labels and specialty labels for various industries. Container Solutions provides aluminum and plastic containers, while Product Decorating offers decorative labeling solutions. Key revenue streams come from both direct sales to customers and long-term contracts with major brands in the consumer goods sector. Additionally, strategic partnerships with global brands enhance CCL's market reach and contribute to consistent revenue growth. The company's emphasis on innovation and sustainability further attracts clients seeking eco-friendly packaging solutions, bolstering its earnings potential.
CCL Industries Earnings Call Summary
Earnings Call Date:Aug 13, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 11, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a balanced outlook with notable achievements in sales growth, improved cash flow, and shareholder returns, contrasted by challenges such as increased tax rates, tariff impacts, and net debt rise. Despite these challenges, the company maintains a strong position in the market.Q2-2025 Updates
Positive Updates
Sales and Operating Income Growth
Sales increased by 4.8% reaching $1.9 billion compared to the previous year's $1.8 billion, with a 5% increase in operating income excluding foreign currency effects.
Improved Free Cash Flow
Free cash flow from operations was $226 million in Q2 2025, significantly up from $118.8 million in Q2 2024, driven by improved earnings and reduced capital expenditures.
Shareholder Returns
The company repurchased approximately 1.3 million shares for $100 million and announced a 10.3% increase in annual dividends, returning a total of $312.1 million to shareholders in 2025.
Strong Segment Performance
CCL segment saw 4.7% organic growth, with strong performance in the HPC business and CCL Design. Innovia showed strong performance in the Americas and improved results in the U.K.
Negative Updates
High Effective Tax Rate
The effective tax rate increased to 25.3% in Q2 2025, up from 18.8% in Q2 2024, impacting net earnings.
Impact of Tariffs
Tariffs affected Avery and Checkpoint segments, with approximately $4 million impact on Avery due to high China content and $1 million on Checkpoint due to Chinese imports.
Net Debt Increase
Net debt rose by $15 million to $1.63 billion as of June 30, 2025, due to higher total debt outstanding.
German Plant Start-up Costs
$3.8 million loss incurred due to start-up costs at the German plant, with limited revenues expected until 2026.
Company Guidance
In CCL Industries' second quarter of 2025 investor update, the company reported a 4.8% increase in sales, reaching $1.9 billion, driven by 2% organic growth, 1% acquisition-related growth, and a 1.8% positive impact from currency translation. Operating income rose by 5% to $322.1 million, excluding currency effects. Notably, net earnings were $213.1 million, down from $279.5 million the previous year, primarily due to a $78.1 million noncash revaluation gain in 2024. Excluding this gain, net earnings were $201.4 million, highlighting a 6.9% increase in net income for the first half of 2025. The company's effective tax rate increased to 25.3% from 18.8% in the prior year, excluding the revaluation gain. EBITDA grew 6%, and free cash flow from operations surged to $226 million from $118.8 million. The company reported a slight increase in net debt to $1.63 billion, maintaining a strong balance sheet with a leverage ratio of 1.04x. Adjusted earnings per Class B share increased by 8% to $1.22, supported by improved operating income, favorable currency translation, and reduced net finance costs. CCL Industries returned $312.1 million to shareholders, through share repurchases and dividends, and plans $485 million in capital expenditure for 2025.CCL Industries Financial Statement Overview
Summary
CCL Industries demonstrates strong financial health with consistent revenue growth, stable profitability margins, and effective cash flow management. The balance sheet reflects prudent leverage, supporting long-term stability. Overall, the company is well-positioned for continued growth in the packaging and containers industry.Income Statement
CCL Industries shows strong revenue growth with a TTM increase of 1.2% and consistent gross profit margins around 29.8%. The net profit margin slightly decreased to 10.6% from 11.6% last year, but remains healthy. EBIT and EBITDA margins are stable, indicating efficient operations.85
Very Positive
Balance Sheet
The company maintains a moderate debt-to-equity ratio of 0.48, reflecting a balanced approach to leverage. Return on equity is solid at 14.9%, showcasing effective use of shareholder funds. The equity ratio is stable, indicating a strong asset base.78
Positive
Cash Flow
Free cash flow growth is robust at 16.6%, and the operating cash flow to net income ratio is strong at 0.76, indicating good cash generation relative to earnings. The free cash flow to net income ratio of 0.67 suggests efficient cash utilization.82
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 7.48B | 7.25B | 6.65B | 6.38B | 5.73B | 5.24B |
| Gross Profit | 2.23B | 2.14B | 1.91B | 1.72B | 1.59B | 1.50B |
| EBITDA | 1.50B | 1.43B | 1.27B | 1.18B | 1.13B | 1.08B |
| Net Income | 792.00M | 843.10M | 530.20M | 622.70M | 599.10M | 529.70M |
Balance Sheet | ||||||
| Total Assets | 10.15B | 9.86B | 8.92B | 8.66B | 7.63B | 7.34B |
| Cash, Cash Equivalents and Short-Term Investments | 962.50M | 828.70M | 774.20M | 839.50M | 602.10M | 703.70M |
| Total Debt | 2.60B | 2.45B | 2.28B | 2.36B | 1.85B | 2.09B |
| Total Liabilities | 4.77B | 4.58B | 4.30B | 4.40B | 3.88B | 4.05B |
| Stockholders Equity | 5.38B | 5.28B | 4.62B | 4.27B | 3.75B | 3.28B |
Cash Flow | ||||||
| Free Cash Flow | 755.40M | 601.90M | 541.70M | 545.60M | 514.90M | 600.10M |
| Operating Cash Flow | 1.12B | 1.06B | 1.00B | 992.80M | 838.70M | 882.90M |
| Investing Cash Flow | -370.10M | -600.30M | -768.00M | -706.60M | -541.30M | -428.00M |
| Financing Cash Flow | -471.40M | -424.30M | -295.20M | -72.60M | -370.00M | -461.30M |
CCL Industries Technical Analysis
Negative
78.24
Price Trends
79.38
Negative
79.01
Negative
75.48
Positive
Market Momentum
0.09
Negative
45.98
Neutral
43.97
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CCL.B, the sentiment is Negative. The current price of 78.24 is above the 20-day moving average (MA) of 77.81, below the 50-day MA of 79.38, and above the 200-day MA of 75.48, indicating a neutral trend. The MACD of 0.09 indicates Negative momentum. The RSI at 45.98 is Neutral, neither overbought nor oversold. The STOCH value of 43.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:CCL.B.
CCL Industries Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| ― | $14.13B | 18.09 | 14.88% | 1.61% | 7.90% | 19.55% | |
| ― | C$2.54B | 13.27 | 10.45% | 7.56% | 3.19% | -0.26% | |
| ― | C$1.64B | 9.18 | 9.36% | 9.59% | -2.90% | 57.43% | |
| ― | C$1.58B | 9.02 | 9.36% | 9.69% | -2.90% | 57.43% | |
| ― | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
| ― | $1.04B | ― | -0.47% | 4.36% | 2.77% | 81.01% | |
| ― | C$59.90M | 26.68 | 3.58% | ― | 6.69% | -49.29% |
* Consumer Cyclical Sector Average
TSE:CCL.B
CCL Industries
78.24
-2.27
-2.82%
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CCL Industries Corporate Events
CCL Industries Reports Record Second Quarter Results
Aug 15, 2025
CCL Industries Inc. is a global leader in specialty label, security, and packaging solutions, serving a diverse clientele including global corporations, government institutions, small businesses, and consumers. The company operates in the consumer packaging, healthcare, electronics, and automotive sectors with a significant presence in 42 countries.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.