SONOCO PRODUCTS CO (SON) Stock Fundamental Analysis
NYSE:SON - New York Stock Exchange, Inc. - US8354951027 - Common Stock - Currency: USD
Overall SON gets a fundamental rating of 4 out of 10. We evaluated SON against 22 industry peers in the Containers & Packaging industry. There are concerns on the financial health of SON while its profitability can be described as average. SON has a valuation in line with the averages, but it does not seem to be growing. SON also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
SON had positive earnings in the past year.
In the past year SON had a positive cash flow from operations.
Of the past 5 years SON 4 years were profitable.
Each year in the past 5 years SON had a positive operating cash flow.
1.2 Ratios
SON has a Return On Assets of 1.21%. This is comparable to the rest of the industry: SON outperforms 40.91% of its industry peers.
SON has a Return On Equity of 6.26%. This is comparable to the rest of the industry: SON outperforms 50.00% of its industry peers.
Looking at the Return On Invested Capital, with a value of 5.40%, SON is in line with its industry, 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 7.48%.
| 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
The Profit Margin of SON (2.85%) is comparable to the rest of the industry.
SON's Profit Margin has declined in the last couple of years.
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.
The Gross Margin of SON (21.49%) is comparable to the rest of the 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
SON has less shares outstanding than it did 5 years ago.
SON has a worse debt/assets ratio than last year.
2.2 Solvency
SON has an Altman-Z score of 1.04. This is a bad value and indicates that SON is not financially healthy and even has some risk of bankruptcy.
SON's Altman-Z score of 1.04 is on the low side compared to the rest of the industry. SON is outperformed by 77.27% of its industry peers.
The Debt to FCF ratio of SON is 118.61, which is on the high side as it means it would take SON, 118.61 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 118.61, SON is doing worse than 68.18% of the companies in the same industry.
SON has a Debt/Equity ratio of 2.03. This is a high value indicating a heavy dependency on external financing.
SON's Debt to Equity ratio of 2.03 is on the low side compared to the rest of the industry. SON is outperformed by 72.73% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.03 | ||
| Debt/FCF | 118.61 | ||
| Altman-Z | 1.04 |
ROIC/WACC0.84
WACC6.42%
2.3 Liquidity
SON has a Current Ratio of 0.80. This is a bad value and indicates that SON is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of SON (0.80) is worse than 86.36% of its industry peers.
SON has a Quick Ratio of 0.80. This is a bad value and indicates that SON is not financially healthy enough and could expect problems in meeting 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.
The Earnings Per Share has been growing slightly by 6.80% on average over the past years.
Looking at the last year, SON shows a very negative growth in Revenue. The Revenue has decreased by -19.61% in the last year.
The Revenue has been decreasing by -0.26% on average over the past years.
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 small growth in Earnings Per Share. The EPS will grow by 6.59% on average per year.
The Revenue is expected to grow by 6.36% on average over the next years.
EPS Next Y24.1%
EPS Next 2Y16.37%
EPS Next 3Y12.86%
EPS Next 5Y6.59%
Revenue Next Year17.11%
Revenue Next 2Y8.13%
Revenue Next 3Y6.83%
Revenue Next 5Y6.36%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
SON is valuated reasonably with a Price/Earnings ratio of 8.76.
100.00% of the companies in the same industry are more expensive than SON, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of SON to the average of the S&P500 Index (25.91), we can say SON is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 6.81, the valuation of SON can be described as very cheap.
Compared to the rest of the industry, the Price/Forward Earnings ratio of SON indicates a rather cheap valuation: SON is cheaper than 100.00% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.85, SON is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.76 | ||
| Fwd PE | 6.81 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SON is on the same level as its industry peers.
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 | 74.04 | ||
| EV/EBITDA | 11.78 |
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.
SON's earnings are expected to grow with 12.86% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.36
PEG (5Y)1.29
EPS Next 2Y16.37%
EPS Next 3Y12.86%
5. Dividend
5.1 Amount
SON has a Yearly Dividend Yield of 4.63%, which is a nice return.
SON's Dividend Yield is rather good when compared to the industry average which is at 3.20. SON pays more dividend than 90.91% of the companies in the same industry.
SON's Dividend Yield is rather good when compared to the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.63% |
5.2 History
The dividend of SON has a limited annual growth rate of 4.02%.
SON has paid a dividend for at least 10 years, which is 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 133.57% of its income as dividend. 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 2Y16.37%
EPS Next 3Y12.86%
45.11
-0.16 (-0.35%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryContainers & Packaging
Earnings (Last)
Earnings (Next)
Inst Owners82.65%
Inst Owner Change2.64%
Ins Owners0.27%
Ins Owner Change11.88%
Market Cap4.45B
Analysts78.57
Price Target57.25 (26.91%)
Short Float %3.5%
Short Ratio3.85
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.63% |
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)-0.29%
PT rev (3m)-6.9%
EPS NQ rev (1m)2.78%
EPS NQ rev (3m)0.93%
EPS NY rev (1m)2.11%
EPS NY rev (3m)-0.84%
Revenue NQ rev (1m)1.55%
Revenue NQ rev (3m)5.09%
Revenue NY rev (1m)-1.05%
Revenue NY rev (3m)-3.93%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.76 | ||
| Fwd PE | 6.81 | ||
| P/S | 0.83 | ||
| P/FCF | 74.04 | ||
| P/OCF | 9.68 | ||
| P/B | 1.82 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.78 |
EPS(TTM)5.15
EY11.42%
EPS(NY)6.62
Fwd EY14.68%
FCF(TTM)0.61
FCFY1.35%
OCF(TTM)4.66
OCFY10.33%
SpS54.52
BVpS24.82
TBVpS-28.04
PEG (NY)0.36
PEG (5Y)1.29
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 | 1.04 |
F-Score5
WACC6.42%
ROIC/WACC0.84
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 Y24.1%
EPS Next 2Y16.37%
EPS Next 3Y12.86%
EPS Next 5Y6.59%
Revenue 1Y (TTM)-19.61%
Revenue growth 3Y-1.73%
Revenue growth 5Y-0.26%
Sales Q2Q%4.38%
Revenue Next Year17.11%
Revenue Next 2Y8.13%
Revenue Next 3Y6.83%
Revenue Next 5Y6.36%
EBIT growth 1Y-16.37%
EBIT growth 3Y1.21%
EBIT growth 5Y0.22%
EBIT Next Year78.6%
EBIT Next 3Y24.19%
EBIT Next 5Y14.85%
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%