04-12-2025, 11:00 PM
(This post was last modified: 04-17-2025, 11:49 PM by 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:
And then the CEO discusses some of the progress they're making in changing the company:
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.
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.
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan
“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan