Sonoco Products Co. (SON) and new spreadsheet contributions

[Dividend Watcher]

Some Background

Now that I'm retired, I've been slowly going through our portfolios and taking a closer look at who & what we're invested in. I have to admit, however, there were times over the last couple decades when I did not follow or periodically review any of our investments. The major things I watched for were dividend freezes, cuts, and eliminations, companies being acquired or split up, and bankruptcies.

In addition, I am now looking through the Dividend Champions, Contenders & Challengers lists, collectively referred to as the "CCC List", to evaluate new companies to consider adding to or replacing companies in our portfolios.

For those that have happened to stumble onto this forum and are unfamiliar with the CCC List, it was a spreadsheet created in the 2000s by the late David Fish of the Moneypaper newsletter. The Moneypaper was dedicated to dividend investing and reinvestment long before brokerages began offering automatic dividend reinvestment on their own. He produced a new version monthly as new data became available. 

I had used the CCC List extensively to begin my dividend growth journey. After his passing, the list maintenance was taken over by Justin Law of the Portfolio-Insight web site. You can access the latest versions for free here. There's a new version every week but I've found that the important information to make an informed, long-term investment decision doesn't really change that often.

What I Am Doing

Since the CCC List was taken over, I've often found mistakes in the "new" CCC List and some of the data I found helpful in Mr. Fish's original version has been removed or summarized.

I am now in the process of selecting companies I want to research, going to their investor relations web site and downloading all their annual reports and/or Form 10Ks back to 2007 where possible and building my own spreadsheets. Why 2007, you say? Well, I wanted to include data going through the Great Recession of 2008-2009 so I (and now you) could see what happened to a company's financials during what was one of the worst economic downturns since the 1973-1974 Stagflation recession and the Great Depression of the 1930s.

Since Yahoo Finance now requires you to have a paid membership to download pricing history, I am now downloading pricing data from Nasdaq.com. Unfortunately, Nasdaq.com only offers the last 10 years of pricing data for general consumption and I am hand entering data as needed to get history back to the end of 2014. Ten years of pricing data seems to be enough to get an idea of how Mr. Market is viewing the company.

The spreadsheets contain the data I feel would help me make decisions on whether I should invest or not. I have several templates for different industries and I modify each as necessary to include or remove certain information specifically as warranted.

What Is This

Attached to this thread is a copy of one of these spreadsheets. It is created in LibreOffice (https://www.libreoffice.org/), an open source software package that is compatible with Microsoft Office/Office 365. The format is Open Document Format (ODF) which Microsoft Excel can open natively. You shouldn't see much difference except for any formatting glitches in the translation. If you want to look, I recommend downloading the spreadsheet to your computer and opening it from there as there may be some issues with your browser and the data format passed to Excel.

Once it is open, you can create your own graphs or add your own statistics to supplement the data that is already there. I've tried to include the most common ones.

Disclaimers:

• I can't guarantee every number is correct. After looking through a ton of pdf files and hand copying data, errors are bound to creep in. If you find any errors, feel free to let me know about them so I can correct it.
  
  
• Sometimes data from a prior year is restated in a following document due to accounting rule changes, data changing or clarified through the reorganization process, etc. When I enter it in the spreadsheet, I generally use the numbers published in the original data for that year. I DO NOT go back and modify prior data since it is my opinion that the pricing of a company's stock is dependent on the data that was available at the time it was published.
  
  
• I am not a financial planner nor a degreed accountant so any misstatement or calculation of statistics are as I best understand it. Often statistics can be calculated in several different ways depending on how that data is being used. I've used Investopedia extensively to double check my calculations using the data specifically available to me and focusing on the investment viewpoint.
  
  
• When a company is going through some financial hardship or reorganization, some of the numbers don't make any sense; i.e., a negative P/E ratio or ROE. Other rating services usually mark it as "Not Measureable" or set it to zero. I will usually leave it as calculated so I can judge how drastic the change is from the norm.
  
  
• Do not use this information as the sole source to make investment decisions. I highly recommend you at least skim a couple years of annual reports to become familiar with the company. I make no guarantees along with all the other disclaimers other organizations usually list.
  

I will post more spreadsheets and company information as I get through them and find an interest.

Lastly, I don't need a bunch of thanks as a result. If any of these spreadsheets help, please join in the conversation. You can also send Kerim a donation to help with the upkeep of this site. I still believe in one of the original uses of the internet as a medium to share information with other people without trying to sell you something or selling your information to others to make a buck off of you. You'll notice there are no annoying ads on this web site.

[Dividend Watcher]

Sonoco Products Co.

GICS Sector: Materials
Sub-Industry: Paper & Plastic Packaging Products and Materials

The first company is one that intrigued me as I was perusing the CCC List -- Sonoco Products Co. It had over 40 years of dividend increases and was yielding around 4%. I had never even looked at this company until a few months ago because it was in the Materials sector which, for the most part, can be volatile.

Looking into the data, I noticed that the EPS history was not very exciting and did not lead to a great margin of safety for their dividend payouts. When you finally get a look at their cash flows, their finances looked much more interesting despite being in a very cyclical industry.

Over the last 3 years, you'll see the effects of their ongoing reorganization is obvious in the spreadsheet data. Basically, they are getting out of the plastic flexible packaging field and focusing on the paperboard and metal packaging.

Sonoco Products is a company that started over 100 years ago and is a world-wide manufacturer today.

As an introduction, I'll add a couple quotes from their 2024 annual report. The first is their updated strategy:

Quote:Sonoco’s goal is to increase its long-term profitability and return capital to shareholders.

Over the past several years, we have simplified our portfolio around fewer, bigger businesses, which has reduced operating complexity and improved agility. The Company’s operating and reporting structure consists of two reportable segments, Consumer Packaging and Industrial Paper Packaging, with all remaining businesses reported as All Other. The Consumer Packaging segment provides customers with a variety of food and household packaging products through our global metal packaging and rigid paper container businesses.

Our Industrial Paper Packaging segment provides high-grade paper products and converting services to customers in the consumer staple, consumer durables and industrial markets. Sonoco’s paper products are produced with 100% uncoated recycled paperboard. Our remaining businesses, categorized as All Other, serve a wide variety of end markets, including consumer staples, consumer discretionary and industrial.

And then the CEO discusses some of the progress they're making in changing the company:

Quote:In 2024, we continued to focus on improving returns on both organic investments and acquisitions with the goals of better balancing our business mix, improving profits, growing operating cash flow and free cash flow and operating the business with better efficiency.

If you're interested, please take a look at the spreadsheet and provide feedback both on my spreadsheet presentation and also about Sonoco specifically.

NOTE: I found out after-the-fact that the forum software won't accept uncompressed document files. I converted it to a Zip file so you will have to download it and unzip it from there.

[Kerim]

Wow, DW -- a nerd after my own heart!

I've been keeping spreadsheets like that for the companies I own/watch for years, with all of the quarterly and annual data gather by hand from the company reports. Mine aren't nearly as polished as that, but it would be interesting to see if our data match. And I agree it is a pain to make it all make sense sometimes. I've come to dread splits. It has given me an appreciation and slight bias toward companies whose financials are simple to understand; don't try to hide things with a million asterisks, footnotes, and adjustments; and that are consistent over time.

I also find it helps me keep a much closer eye on the companies. Of course it also means when life gets busy, my data gets stale.

[Dividend Watcher]

Update: I found several major errors in the spreadsheet template so the data and statistics were incorrect in my original post. I've corrected the file above so if you've downloaded the above and using the data to consider Sonoco, please delete the old version and download the updated version in the link above.

I've also added a couple more fields of statistical data to help with the analysis. Again, if you find any errors, please let me know.

Also, I should have put it in the original post. I do not own shares of SON at this time.