Sonoco Products Stock Drops 16% as Company Lowers Full Year Earnings Outlook

Key Stats for Sonoco Products Stock

• Price change for Sonoco Products stock: -16%
• $SON Share Price as of Apr. 22: $48
• 52-Week High: $58
• $SON Stock Price Target: $63

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What Happened?

Sonoco Products (SON) stock fell after the company maintained its full-year revenue guidance but narrowed its earnings outlook toward the lower end of its range — a signal that rising costs are starting to bite.

Q1 results were actually decent.

• EPS came in at $1.20, meeting estimates.
• Sales hit $1.68 billion, below estimates of $1.71 billion.
• The company also raised its quarterly dividend for the 43rd consecutive year, to $0.54 per share. That’s a genuinely impressive streak.

So what’s worrying investors? The Q2 cost outlook.

• Management flagged $8 million to $10 million in additional input cost inflation hitting in Q2, driven primarily by higher freight and energy-related expenses tied to the Middle East conflict.
• These costs hit fast. The recovery mechanisms — mainly pricing adjustments — come with a lag of roughly a month.

For the full year,

• Sonoco Products stock is now facing a tighter EPS result expected toward the lower end of the $5.80 to $6.20 guidance.
• Management was clear: the inflation is hitting EPS harder than EBITDA, because the tax effect amplifies the impact when you get into the earnings per share math.

There were also real operational headaches in Q1.

• Severe winter storms shut down two of Sonoco’s largest paper can customers for 7 to 8 days.
• A fire destroyed its recycling facility in Greenville, South Carolina.
• The macro environment turned choppier toward the end of the quarter.

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What the Market Is Telling Us About Sonoco Products Stock

The drop in Sonoco Products stock reflects the market’s frustration with a story that was supposed to be simpler after recent divestitures. The company shed ThermoSafe and TFP in 2025 to focus on its core packaging business.

That simplification was supposed to drive cleaner margins. Instead, external headwinds are causing damage before the benefits have fully materialized.

The underlying business isn’t broken. Sonoco Products stock still carries a ~3.8% dividend yield and the company’s profitability improvement program is on track, delivering $8 million in savings in Q1 alone toward a $150–$200 million three-year target.

April is showing some early improvement. If inflation stabilizes and volumes recover, Sonoco Products stock could find its footing again in the back half of the year.

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Disclaimer:

Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!