SONOCO PRODUCTS CO (SON) Stock Fundamental Analysis
USA - NYSE:SON - US8354951027 - Common Stock
40.36 USD
-1.07 (-2.58%)
40.4 USD
+0.04 (+0.1%)
We assign a fundamental rating of 5 out of 10 to SON. SON was compared to 22 industry peers in the Containers & Packaging industry. While SON is still in line with the averages on profitability rating, there are concerns on its financial health. SON is valued quite cheap, while showing a decent growth score. This is a good combination! SON also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year SON was profitable.
In the past year SON had a positive cash flow from operations.
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
Looking at the Return On Assets, with a value of 4.64%, SON belongs to the top of the industry, outperforming 81.82% of the companies in the same industry.
SON has a Return On Equity of 17.18%. This is amongst the best in the industry. SON outperforms 81.82% of its industry peers.
With a Return On Invested Capital value of 4.94%, SON perfoms like the industry average, outperforming 40.91% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for SON is in line with the industry average of 7.26%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.64% | ||
| ROE | 17.18% | ||
| ROIC | 4.94% |
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 of 9.81%. This is amongst the best in the industry. SON outperforms 90.91% of its industry peers.
SON's Profit Margin has declined in the last couple of years.
SON's Operating Margin of 9.99% is fine compared to the rest of the industry. SON outperforms 63.64% of its industry peers.
In the last couple of years the Operating Margin of SON has remained more or less at the same level.
SON's Gross Margin of 21.26% is in line compared to the rest of the industry. SON outperforms 50.00% of its industry peers.
In the last couple of years the Gross Margin of SON has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.99% | ||
| PM (TTM) | 9.81% | ||
| GM | 21.26% |
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so SON is still creating some value.
Compared to 1 year ago, SON has more shares outstanding
Compared to 5 years ago, SON has less shares outstanding
Compared to 1 year ago, SON has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.33, we must say that SON is in the distress zone and has some risk of bankruptcy.
SON's Altman-Z score of 1.33 is on the low side compared to the rest of the industry. SON is outperformed by 68.18% of its industry peers.
SON has a debt to FCF ratio of 38.01. This is a negative value and a sign of low solvency as SON would need 38.01 years to pay back of all of its debts.
The Debt to FCF ratio of SON (38.01) is comparable to the rest of the industry.
A Debt/Equity ratio of 1.54 is on the high side and indicates that SON has dependencies on debt financing.
SON has a worse Debt to Equity ratio (1.54) than 63.64% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.54 | ||
| Debt/FCF | 38.01 | ||
| Altman-Z | 1.33 |
ROIC/WACC0.66
WACC7.44%
2.3 Liquidity
SON has a Current Ratio of 1.25. This is a normal value and indicates that SON is financially healthy and should not expect problems in meeting its short term obligations.
SON has a Current ratio (1.25) which is comparable to the rest of the industry.
A Quick Ratio of 0.72 indicates that SON may have some problems paying its short term obligations.
SON has a Quick ratio (0.72) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.25 | ||
| Quick Ratio | 0.72 |
3. Growth
3.1 Past
SON shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 15.48%, which is quite good.
Measured over the past 5 years, SON shows a small growth in Earnings Per Share. The EPS has been growing by 6.80% on average per year.
Looking at the last year, SON shows a decrease in Revenue. The Revenue has decreased by -2.50% in the last year.
Measured over the past years, SON shows a decrease in Revenue. The Revenue has been decreasing by -0.26% on average per year.
EPS 1Y (TTM)15.48%
EPS 3Y11.27%
EPS 5Y6.8%
EPS Q2Q%28.86%
Revenue 1Y (TTM)-2.5%
Revenue growth 3Y-1.73%
Revenue growth 5Y-0.26%
Sales Q2Q%27.16%
3.2 Future
SON is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.45% yearly.
SON is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.14% yearly.
EPS Next Y21.68%
EPS Next 2Y15.04%
EPS Next 3Y12.12%
EPS Next 5Y10.45%
Revenue Next Year16.21%
Revenue Next 2Y7.88%
Revenue Next 3Y6.37%
Revenue Next 5Y6.14%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
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
Based on the Price/Earnings ratio of 7.12, the valuation of SON can be described as very cheap.
100.00% of the companies in the same industry are more expensive than SON, based on the Price/Earnings ratio.
SON is valuated cheaply when we compare the Price/Earnings ratio to 26.91, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 6.24 indicates a rather cheap valuation of SON.
Based on the Price/Forward Earnings ratio, SON is valued cheaper than 95.45% of the companies in the same industry.
SON's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.92.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.12 | ||
| Fwd PE | 6.24 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as SON.
SON's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.9 | ||
| EV/EBITDA | 9.07 |
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.
The decent profitability rating of SON may justify a higher PE ratio.
SON's earnings are expected to grow with 12.12% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.33
PEG (5Y)1.05
EPS Next 2Y15.04%
EPS Next 3Y12.12%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.11%, SON is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.34, 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 2.34, SON pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.11% |
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 their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)4.02%
Div Incr Years26
Div Non Decr Years26
5.3 Sustainability
SON pays out 37.02% of its income as dividend. This is a sustainable payout ratio.
SON's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP37.02%
EPS Next 2Y15.04%
EPS Next 3Y12.12%
40.36
-1.07 (-2.58%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryContainers & Packaging
Earnings (Last)
Earnings (Next)
Inst Owners84.89%
Inst Owner Change-0.4%
Ins Owners0.37%
Ins Owner Change1.16%
Market Cap3.98B
Revenue(TTM)5.31B
Net Income(TTM)555.81M
Analysts80
Price Target58.59 (45.17%)
Short Float %3.8%
Short Ratio3.6
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.11% |
Yearly Dividend2.07
Dividend Growth(5Y)4.02%
DP37.02%
Div Incr Years26
Div Non Decr Years26
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-5.26%
Min EPS beat(2)-6.6%
Max EPS beat(2)-3.91%
EPS beat(4)1
Avg EPS beat(4)-6.6%
Min EPS beat(4)-17.56%
Max EPS beat(4)1.68%
EPS beat(8)4
Avg EPS beat(8)-0.5%
EPS beat(12)7
Avg EPS beat(12)1.09%
EPS beat(16)11
Avg EPS beat(16)1.84%
Revenue beat(2)0
Avg Revenue beat(2)-8.87%
Min Revenue beat(2)-16.99%
Max Revenue beat(2)-0.76%
Revenue beat(4)0
Avg Revenue beat(4)-10.15%
Min Revenue beat(4)-19.38%
Max Revenue beat(4)-0.76%
Revenue beat(8)1
Avg Revenue beat(8)-6.34%
Revenue beat(12)1
Avg Revenue beat(12)-6.25%
Revenue beat(16)4
Avg Revenue beat(16)-4.5%
PT rev (1m)0%
PT rev (3m)1.77%
EPS NQ rev (1m)-1.72%
EPS NQ rev (3m)-0.77%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.01%
Revenue NQ rev (1m)-0.45%
Revenue NQ rev (3m)0.46%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.73%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.12 | ||
| Fwd PE | 6.24 | ||
| P/S | 0.7 | ||
| P/FCF | 27.9 | ||
| P/OCF | 7.32 | ||
| P/B | 1.23 | ||
| P/tB | N/A | ||
| EV/EBITDA | 9.07 |
EPS(TTM)5.67
EY14.05%
EPS(NY)6.47
Fwd EY16.03%
FCF(TTM)1.45
FCFY3.58%
OCF(TTM)5.51
OCFY13.66%
SpS57.43
BVpS32.8
TBVpS-22.28
PEG (NY)0.33
PEG (5Y)1.05
Graham Number64.69
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.64% | ||
| ROE | 17.18% | ||
| ROCE | 5.93% | ||
| ROIC | 4.94% | ||
| ROICexc | 5.12% | ||
| ROICexgc | 12.48% | ||
| OM | 9.99% | ||
| PM (TTM) | 9.81% | ||
| GM | 21.26% | ||
| FCFM | 2.52% |
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%
ROICexgc growth 3Y-9.06%
ROICexgc 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-Score4
Asset Turnover0.47
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.54 | ||
| Debt/FCF | 38.01 | ||
| Debt/EBITDA | 4.93 | ||
| Cap/Depr | 89.96% | ||
| Cap/Sales | 7.08% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 53.74% | ||
| Profit Quality | 25.67% | ||
| Current Ratio | 1.25 | ||
| Quick Ratio | 0.72 | ||
| Altman-Z | 1.33 |
F-Score4
WACC7.44%
ROIC/WACC0.66
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)15.48%
EPS 3Y11.27%
EPS 5Y6.8%
EPS Q2Q%28.86%
EPS Next Y21.68%
EPS Next 2Y15.04%
EPS Next 3Y12.12%
EPS Next 5Y10.45%
Revenue 1Y (TTM)-2.5%
Revenue growth 3Y-1.73%
Revenue growth 5Y-0.26%
Sales Q2Q%27.16%
Revenue Next Year16.21%
Revenue Next 2Y7.88%
Revenue Next 3Y6.37%
Revenue Next 5Y6.14%
EBIT growth 1Y-14.15%
EBIT growth 3Y1.21%
EBIT growth 5Y0.22%
EBIT Next Year77.39%
EBIT Next 3Y24.4%
EBIT Next 5Y14.67%
FCF growth 1Y-56.98%
FCF growth 3Y117.79%
FCF growth 5Y13.88%
OCF growth 1Y-19.23%
OCF growth 3Y40.81%
OCF growth 5Y14.38%
SONOCO PRODUCTS CO / SON FAQ
What is the ChartMill fundamental rating of SONOCO PRODUCTS CO (SON) stock?
ChartMill assigns a fundamental rating of 5 / 10 to SON.
What is the valuation status for SON stock?
ChartMill assigns a valuation rating of 8 / 10 to SONOCO PRODUCTS CO (SON). This can be considered as Undervalued.
What is the profitability of SON stock?
SONOCO PRODUCTS CO (SON) has a profitability rating of 6 / 10.
What is the valuation of SONOCO PRODUCTS CO based on its PE and PB ratios?
The Price/Earnings (PE) ratio for SONOCO PRODUCTS CO (SON) is 7.12 and the Price/Book (PB) ratio is 1.23.
What is the expected EPS growth for SONOCO PRODUCTS CO (SON) stock?
The Earnings per Share (EPS) of SONOCO PRODUCTS CO (SON) is expected to grow by 21.68% in the next year.