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Sonoco (SON) Hits 52-Week High on Strong Inorganic Growth

SON PKG UFPT BERY

Trades from $3

Shares of Sonoco Products Co. (SON - Free Report) reached a fresh 52-week high of $53.57 during the trading session on Sep 22. The company ended the day’s trading marginally lower at $53.50. Notably, year to date, the stock has returned around 31%.

Sonoco has a market capitalization of roughly $5.4 billion. Average volume of shares traded over the last three months is around 470.8K. The stock flaunts a one-year return of over 41%. Moreover, it has beaten the Zacks Consensus Estimate in three of the trailing four quarters, with an average positive surprise of 3.57%.

SONOCO PRODUCTS Price and Consensus

 

SONOCO PRODUCTS Price and Consensus | SONOCO PRODUCTS Quote

Driving Factors

Sonoco remains committed to executing on its ‘Grow and Optimize’ strategy, which is focused on targeted growth of its Consumer Packaging and Protective Solutions businesses, and optimizing its Industrial-focused businesses.

In line with this, Sonoco’s unit Sonoco ThermoSafe acquired London-based Laminar Medica from Clinimed (Holdings) Limited on Sep 20. This acquisition will help expand its footprint in the European Temperature-Controlled packaging market.

Sonoco ThermoSafe had acquired the PharmaPort 360 assets, licenses, trademarks and manufacturing rights from AAR earlier this month. This buyout will help the company to enter the active temperature-controlled cargo containers market.

Sonoco is also slated to launch several new innovative products in 2016, as it continues to work closely with customers through its i6 Innovation Process and utilizing the full capabilities of the recently opened IPS Studio in Hartsville. According to management, additional opportunities exist for growing as well as optimizing its customers' operations in Europe.

Additionally, the company has capital growth projects in the pipeline through 2017 that will help expand its global production capability in composite cans, flexible packaging and rigid plastic containers. Moreover, it remains focused on offsetting current economic, market and currency headwinds by further optimizing its supply chain, driving productivity improvements and streamlining its cost structure.

At present, Sonoco carries a Zacks Rank #3 (Hold).

Stocks to Consider

Better-ranked stocks in the same industry include Berry Plastics Group, Inc. (BERY - Free Report) , Packaging Corporation of America (PKG - Free Report) and UFP Technologies, Inc. (UFPT - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Among these, Berry Plastics hit a 52-week high of $46.26 on Sep 6 and has seen solid estimate revisions over the past 60 days. Packaging Corporation of America touched a 52-week high of $82.06 on Sep 16 and has witnessed solid estimate revisions over the past 90 days. Also, UFP Technologies reached a 52-week high of $27.35 on Sep 21 and has seen solid estimate revisions over the past 30 days.

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