KeyBanc Downgrades Sonoco Products (SON) to Hold

May 13, 2009 7:29 AM EDT

KeyBanc downgrades Sonoco Products (NYSE: SON) from Buy to Hold.

KeyBanc analyst says, "Following recent due diligence, we believe SON collection of Consumer-related businesses are performing well and should exhibit sequential improvement through 2009 driven by the consumer trade down to value products (i.e., concentrate, dough) as well as conversions from metal to composite cans occurring in coffee and powdered infant formula (internationally). Unfortunately the progress being made in the Consumer segment is being more than offset by continued weakness in the Industrial businesses. We believe the Industrial trajectory has remained largely unchanged from November with global volumes for Tubes and Cores down 15-20%. Looking forward over the balance of the year, we anticipate the volume levels will track somewhat similarly with the normal seasonal uptick, and possibly some slight benefit from the hemorrhaging of SON's two largest North American competitors. While acknowledging the prospect of favorable price/cost and further consolidations & acquisitions over the balance of 2009, we believe the risk/reward has become more balanced."

To see more analyst ratings on SON Click Here.

Sonoco Products Company (Sonoco) is a manufacturer of industrial and consumer packaging products and a provider of packaging services, with 327 locations in 35 countries.

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