Sonoco: Our Long-Term Outlook Remains Unchanged After Investor Day; Shares Fairly Valued

No-moat-rated Sonoco held its investor day on Feb. 22 and offered updates on the company’s core business segments and long-term outlook. The business environment for both consumer packaging and industrial paper packaging remains challenging, largely due to persistent inventory destocking and inflationary headwinds that have weighed on consumer spending. Nevertheless, our forecast calls for consolidated revenue to grow at a 3.4% compound annual growth rate over the next five years as the company recovers from a challenging 2023. The outlook provided at the investor day does not alter our long-term outlook, and we maintain our $55 fair value estimate.