SONOCO PRODUCTS CO (SON) Stock Fundamental Analysis
NYSE:SON - New York Stock Exchange, Inc. - US8354951027 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to SON. SON was compared to 22 industry peers in the Containers & Packaging industry. SON has a medium profitability rating, but doesn't score so well on its financial health evaluation. SON has a decent growth rate and is not valued too expensively. SON also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year SON was profitable.
SON had a positive operating cash flow in the past year.
SON had positive earnings in 4 of the past 5 years.
SON had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a Return On Assets value of 1.21%, SON is not doing good in the industry: 63.64% of the companies in the same industry are doing better.
SON has a Return On Equity (6.26%) which is in line with its industry peers.
The Return On Invested Capital of SON (5.40%) is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for SON is in line with the industry average of 7.58%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.21% | ||
| ROE | 6.26% | ||
| ROIC | 5.4% |
ROA(3y)4.84%
ROA(5y)3.36%
ROE(3y)16.46%
ROE(5y)11.13%
ROIC(3y)8.06%
ROIC(5y)9.38%
1.3 Margins
SON has a Profit Margin (2.85%) which is comparable to the rest of the industry.
In the last couple of years the Profit Margin of SON has declined.
SON has a better Operating Margin (10.47%) than 68.18% of its industry peers.
In the last couple of years the Operating Margin of SON has remained more or less at the same level.
With a Gross Margin value of 21.49%, SON perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
In the last couple of years the Gross Margin of SON has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.47% | ||
| PM (TTM) | 2.85% | ||
| GM | 21.49% |
OM growth 3Y2.99%
OM growth 5Y0.48%
PM growth 3YN/A
PM growth 5Y-10.66%
GM growth 3Y4.17%
GM growth 5Y1.76%
2. Health
2.1 Basic Checks
SON has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, SON has more shares outstanding
Compared to 5 years ago, SON has less shares outstanding
SON has a worse debt/assets ratio than last year.
2.2 Solvency
SON has an Altman-Z score of 1.05. This is a bad value and indicates that SON is not financially healthy and even has some risk of bankruptcy.
SON has a Altman-Z score of 1.05. This is in the lower half of the industry: SON underperforms 77.27% of its industry peers.
SON has a debt to FCF ratio of 118.61. This is a negative value and a sign of low solvency as SON would need 118.61 years to pay back of all of its debts.
The Debt to FCF ratio of SON (118.61) is worse than 68.18% of its industry peers.
SON has a Debt/Equity ratio of 2.03. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of SON (2.03) is worse than 72.73% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.03 | ||
| Debt/FCF | 118.61 | ||
| Altman-Z | 1.05 |
ROIC/WACC0.83
WACC6.52%
2.3 Liquidity
A Current Ratio of 0.80 indicates that SON may have some problems paying its short term obligations.
SON has a worse Current ratio (0.80) than 86.36% of its industry peers.
A Quick Ratio of 0.51 indicates that SON may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.51, SON is doing worse than 86.36% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.8 | ||
| Quick Ratio | 0.51 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 3.41% over the past year.
SON shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.80% yearly.
The Revenue for SON has decreased by -19.61% in the past year. This is quite bad
SON shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -0.26% yearly.
EPS 1Y (TTM)3.41%
EPS 3Y11.27%
EPS 5Y6.8%
EPS Q2Q%23.21%
Revenue 1Y (TTM)-19.61%
Revenue growth 3Y-1.73%
Revenue growth 5Y-0.26%
Sales Q2Q%4.38%
3.2 Future
Based on estimates for the next years, SON will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.12% on average per year.
Based on estimates for the next years, SON will show a small growth in Revenue. The Revenue will grow by 6.05% on average per year.
EPS Next Y23.89%
EPS Next 2Y16.02%
EPS Next 3Y12.62%
EPS Next 5Y9.12%
Revenue Next Year15.7%
Revenue Next 2Y7.94%
Revenue Next 3Y6.63%
Revenue Next 5Y6.05%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 8.91, the valuation of SON can be described as very reasonable.
95.45% of the companies in the same industry are more expensive than SON, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.50, SON is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 6.97, the valuation of SON can be described as very cheap.
Based on the Price/Forward Earnings ratio, SON is valued cheaper than 100.00% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 36.44, SON is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.91 | ||
| Fwd PE | 6.97 |
4.2 Price Multiples
SON's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, SON is valued a bit more expensive than 68.18% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 75.3 | ||
| EV/EBITDA | 11.88 |
4.3 Compensation for Growth
SON's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as SON's earnings are expected to grow with 12.62% in the coming years.
PEG (NY)0.37
PEG (5Y)1.31
EPS Next 2Y16.02%
EPS Next 3Y12.62%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.51%, SON is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 2.87, SON pays a better dividend. On top of this SON pays more dividend than 90.91% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.35, SON pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.51% |
5.2 History
The dividend of SON has a limited annual growth rate of 4.02%.
SON has been paying a dividend for at least 10 years, so it has a reliable track record.
SON has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)4.02%
Div Incr Years26
Div Non Decr Years26
5.3 Sustainability
133.57% of the earnings are spent on dividend by SON. This is not a sustainable payout ratio.
SON's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP133.57%
EPS Next 2Y16.02%
EPS Next 3Y12.62%
45.87
-0.38 (-0.82%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryContainers & Packaging
Earnings (Last)
Earnings (Next)
Inst Owners83.96%
Inst Owner Change0%
Ins Owners0.37%
Ins Owner Change12.07%
Market Cap4.52B
Analysts80
Price Target57.46 (25.27%)
Short Float %4.24%
Short Ratio5.2
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.51% |
Yearly Dividend2.07
Dividend Growth(5Y)4.02%
DP133.57%
Div Incr Years26
Div Non Decr Years26
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-10.74%
Min EPS beat(2)-17.56%
Max EPS beat(2)-3.91%
EPS beat(4)2
Avg EPS beat(4)-4.36%
Min EPS beat(4)-17.56%
Max EPS beat(4)2.37%
EPS beat(8)4
Avg EPS beat(8)-0.62%
EPS beat(12)8
Avg EPS beat(12)2.38%
EPS beat(16)11
Avg EPS beat(16)2.04%
Revenue beat(2)0
Avg Revenue beat(2)-18.18%
Min Revenue beat(2)-19.38%
Max Revenue beat(2)-16.99%
Revenue beat(4)0
Avg Revenue beat(4)-11.17%
Min Revenue beat(4)-19.38%
Max Revenue beat(4)-3.46%
Revenue beat(8)1
Avg Revenue beat(8)-7.41%
Revenue beat(12)1
Avg Revenue beat(12)-6.25%
Revenue beat(16)5
Avg Revenue beat(16)-4.12%
PT rev (1m)-1.82%
PT rev (3m)0.08%
EPS NQ rev (1m)-1.72%
EPS NQ rev (3m)-0.7%
EPS NY rev (1m)-0.17%
EPS NY rev (3m)-0.08%
Revenue NQ rev (1m)-0.21%
Revenue NQ rev (3m)0.21%
Revenue NY rev (1m)0.36%
Revenue NY rev (3m)-2.24%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.91 | ||
| Fwd PE | 6.97 | ||
| P/S | 0.84 | ||
| P/FCF | 75.3 | ||
| P/OCF | 9.85 | ||
| P/B | 1.85 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.88 |
EPS(TTM)5.15
EY11.23%
EPS(NY)6.58
Fwd EY14.35%
FCF(TTM)0.61
FCFY1.33%
OCF(TTM)4.66
OCFY10.16%
SpS54.52
BVpS24.82
TBVpS-28.03
PEG (NY)0.37
PEG (5Y)1.31
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.21% | ||
| ROE | 6.26% | ||
| ROCE | 6.47% | ||
| ROIC | 5.4% | ||
| ROICexc | 5.51% | ||
| ROICexgc | 14.22% | ||
| OM | 10.47% | ||
| PM (TTM) | 2.85% | ||
| GM | 21.49% | ||
| FCFM | 1.12% |
ROA(3y)4.84%
ROA(5y)3.36%
ROE(3y)16.46%
ROE(5y)11.13%
ROIC(3y)8.06%
ROIC(5y)9.38%
ROICexc(3y)8.38%
ROICexc(5y)10.09%
ROICexgc(3y)16.5%
ROICexgc(5y)19.85%
ROCE(3y)9.66%
ROCE(5y)11.51%
ROICexcg growth 3Y-9.06%
ROICexcg growth 5Y-7.04%
ROICexc growth 3Y-21.68%
ROICexc growth 5Y-13.61%
OM growth 3Y2.99%
OM growth 5Y0.48%
PM growth 3YN/A
PM growth 5Y-10.66%
GM growth 3Y4.17%
GM growth 5Y1.76%
F-Score5
Asset Turnover0.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.03 | ||
| Debt/FCF | 118.61 | ||
| Debt/EBITDA | 5.14 | ||
| Cap/Depr | 98.43% | ||
| Cap/Sales | 7.43% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 47.45% | ||
| Profit Quality | 39.22% | ||
| Current Ratio | 0.8 | ||
| Quick Ratio | 0.51 | ||
| Altman-Z | 1.05 |
F-Score5
WACC6.52%
ROIC/WACC0.83
Cap/Depr(3y)105.95%
Cap/Depr(5y)100.18%
Cap/Sales(3y)6.57%
Cap/Sales(5y)5.6%
Profit Quality(3y)138.95%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)3.41%
EPS 3Y11.27%
EPS 5Y6.8%
EPS Q2Q%23.21%
EPS Next Y23.89%
EPS Next 2Y16.02%
EPS Next 3Y12.62%
EPS Next 5Y9.12%
Revenue 1Y (TTM)-19.61%
Revenue growth 3Y-1.73%
Revenue growth 5Y-0.26%
Sales Q2Q%4.38%
Revenue Next Year15.7%
Revenue Next 2Y7.94%
Revenue Next 3Y6.63%
Revenue Next 5Y6.05%
EBIT growth 1Y-16.37%
EBIT growth 3Y1.21%
EBIT growth 5Y0.22%
EBIT Next Year77.79%
EBIT Next 3Y24.68%
EBIT Next 5Y14.91%
FCF growth 1Y-77.01%
FCF growth 3Y117.79%
FCF growth 5Y13.88%
OCF growth 1Y-24.17%
OCF growth 3Y40.81%
OCF growth 5Y14.38%