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UPDATE: Citi Starts Sonoco Products (SON) at Buy, 'Improved but Unloved, with Added Defense at the Right Time'

July 1, 2022 6:57 AM EDT
Get Alerts SON Hot Sheet
Price: $61.12 -0.13%

Rating Summary:
    3 Buy, 14 Hold, 3 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 18 | Down: 53 | New: 12
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(Updated - July 1, 2022 6:58 AM EDT)

Citi analyst Anthony Pettinari initiates coverage on Sonoco Products (NYSE: SON) with a Buy rating and a price target of $66.00.

The analyst comments "We are initiating on SON with a Buy rating and $66 target (~19% ETR). SON has recently sharpened its focus on four key categories – composite/metal cans, flexibles, URB & tubes/cores - while divesting smaller non-core businesses. The portfolio shift improves mgmt. focus and increases exposure to more defensive Consumer end markets; est. ~60% of sales now come from staples. While investors questioned the ~$1.35B Metalpack Food Can acquisition last year, the timing was right in our view, as these are typically the most defensive Packaging assets. Coupled with a positive near-term price/cost setup and discount valuation (8.6x NTM EBITDA vs. 9.1x 5-yr avg), we are constructive heading into 2Q. Key catalyst? Positive FY earnings revisions (Citi $5.90 vs. $5.59 cons), while we see peer est. generally moving lower. Per FactSet, of ten Analysts covering SON, there are no Buys (9 Holds, 1 Sell)."

For an analyst ratings summary and ratings history on Sonoco Products click here. For more ratings news on Sonoco Products click here.

Shares of Sonoco Products closed at $57.04 yesterday.


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