Sonoco Expands ClearGuard Portfolio Of Flexible Packaging

Sonoco Products Company (NYSE:SON) has expanded its ClearGuard portfolio of flexible packaging to include pouches for liquid or more viscous products. This latest development will help exceed barrier and shelf-life requirements for a variety of product categories and can also endure the high pressure and high temperatures involved in the retort process.

In Apr 2017, Sonoco launched its ClearGuard packaging, which comes with a transparent look and can be used as a substitute to aluminum foil or metalized films. ClearGuard provides transparency of products to customers without compromising the quality. It offers several additional benefits to brands and consumers, including exceptional laminating with superior flex crack resistance and durability, printing, including matte and gloss finish options, and a competitive value to other clear or opaque film alternatives.

This new ClearGuard liquid pouch optionis able to withstand the rigors of hot fill and retort cooking processes. Sonoco’s ClearGuard packaging will be on display at the Global Pouch Forum in Miami, starting today.

Sonoco is implementing a previously announced price increase for all grades of uncoated recycled paperboard (URB) products. The price increase will be effective on shipments in the U.S. and Canada, beginning Jul 10.

The price rise is a result of URB price increase, along with the impact of rising raw material and other costs. Sonoco stated that the recovered paper prices in June have escalated significantly. The company expects further cost increases in July, as demand from domestic and export users remains strong.

Moreover, Sonoco will continue to look at options to optimize its portfolio, while aggressively pursuing new and different alternatives and continuing to trim costs. The company also remains focused on gaining market share by introducing commercial products and achieving new customer awards.

However, Sonoco has underperformed the Zacks classified Containers-Paper/Plastic sub-industry in the last one year, mainly due to material cost inflation and slowdown in manufacturing. The stock gained around 9.2%, while the industry gained 18.1% over the said time frame.

Zacks Rank & Key Picks

Sonoco currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the same space include Parker-Hannifin Corporation (NYSE:PH) , AptarGroup, Inc. (NYSE:ATR) and UFP Technologies, Inc. (NASDAQ:UFPT) . All three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Parker-Hannifin generated an average positive earnings surprise of 14.94% over the trailing four quarters. AptarGroup has delivered an average positive earnings surprise of 1.78% in the last four quarters. UFP Technologies has an average positive earnings surprise of 7.91% for the past four quarters.

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