Abstract

Sonoco will report its fiscal fourth-quarter results on February 16, 2026 Post Market, with investors watching revenue trajectory, margins, and adjusted EPS amid a mixed demand backdrop and company-level cost actions.

Market Forecast

Consensus and internal projections point to Sonoco’s current quarter revenue of $1.76 billion, implying a year-over-year increase of 05.23%, with forecast EBIT at $0.18 billion and adjusted EPS at $1.00, suggesting year-over-year declines of 09.39% and 17.06%, respectively; margin expectations embed stabilization rather than expansion. The company’s main businesses are expected to reflect stable demand in Consumer Packaging and slower momentum in Industrial Paper Packaging, with emphasis on mix and pricing discipline.

Consumer Packaging remains the company’s most promising segment in the near term, supported by resilient volumes in food and household consumables; it delivered $1.44 billion last quarter and is poised for improvement as pricing-renegotiation benefits flow through, though year-over-year growth trends could be modest in the mid-single-digit range.

Last Quarter Review

In the prior quarter, Sonoco posted revenue of $2.13 billion, a gross profit margin of 21.94%, GAAP net profit attributable to shareholders of $0.12 billion, a net profit margin of 05.77%, and adjusted EPS of $1.92, with year-over-year revenue growth of 27.17% and adjusted EPS growth of 28.86%. The quarter-on-quarter growth of net profit was -75.09%, reflecting a tough comparison and non-operating items, while operationally the company maintained gross margin above 20.00% through cost control and mix.

Management highlighted execution on productivity initiatives and disciplined pricing as primary drivers of profitability, sustaining margin resilience despite input variability. By business, Consumer Packaging revenue was $1.44 billion and Industrial Paper Packaging revenue was $0.58 billion, reinforcing the mix shift toward consumer end markets, while “Other” contributed $0.11 billion; Consumer Packaging carried the growth baton on a year-over-year basis.

Current Quarter Outlook

Main business: Consumer Packaging

Consumer Packaging is positioned to anchor Sonoco’s top line this quarter. Forecast revenue of $1.76 billion for the consolidated company implies that Consumer Packaging will continue to represent a significant majority of the mix, helped by steady demand from food, beverage, and household consumables. Cost pass-through mechanisms and mix improvement are expected to offset lingering input cost fluctuations, aiding gross margin stabilization around the low-20.00% range. With adjusted EPS projected at $1.00, the implied margin structure suggests that Consumer’s contribution must remain solid for the company to meet the midpoint of forecasts, especially if Industrial volumes trail historical averages. Commercial efforts around contract repricing and SKU rationalization should further preserve profitability, although the annual comparisons are demanding given the prior quarter’s strong performance base.

Most promising business: Consumer Packaging near-term mix advantages

The interplay of resilient end-demand and favorable mix makes Consumer Packaging the most likely incremental contributor to earnings quality this quarter. The segment’s $1.44 billion revenue base last quarter anchors scale efficiencies that can hold gross margin despite price normalization in some categories. Any incremental improvement in high-value closures, rigid paper containers, and flexible formats could expand contribution margin, partially mitigating pressure on EBIT, which is forecast at $0.18 billion for the group. The primary watch item is private-label momentum in North America and Europe; a faster mix shift into private label may keep volumes healthy but may cap price per unit, so execution on cost and design-to-value will be key to sustaining EPS near the $1.00 mark.

Stock price swing factor: Industrial Paper Packaging volume sensitivity

Industrial Paper Packaging remains the primary swing factor for shares this quarter, given its cyclical volume sensitivity to boxboard, paper, and broader industrial production trends. With last quarter revenue at $0.58 billion, incremental changes in orders can disproportionately affect operating leverage and EBIT progression. If restocking in paper and paperboard modestly picks up into early 2026, conversion volumes could improve and lift consolidated gross margin above the low-20.00% zone; conversely, flat or weaker demand would keep throughput and margins in check, reinforcing the EPS forecast at roughly $1.00. Investors should monitor lead times, price indices for recovered fiber and resin, and any commentary on customer inventory normalization, which can provide early signals on sequential margin movement.

Analyst Opinions

Across recent sell-side and institutional commentary, the balance of views trends cautiously positive, with the bullish-to-bearish ratio leaning in favor of constructive expectations. Analysts with positive stances emphasize the defensiveness of Consumer Packaging and the potential for margin stability from ongoing productivity and cost actions, even as EBIT and EPS forecasts imply year-over-year declines. The supportive camp points to the company’s ability to hold gross margin around 20.00% and above through pricing discipline and mix management, while awaiting a cyclical turn in Industrial segments to reignite EBIT growth.

Those taking a constructive view also highlight that the forecast revenue increase of 05.23% suggests demand is not deteriorating, and that the prior quarter’s adjusted EPS of $1.92 provides a strong base to compare the trajectory of cost control and mix. They expect that, while adjusted EPS is modeled at $1.00 this quarter, execution on procurement and footprint optimization could temper downside risks, with upside tied to any improvement in Industrial order books. On balance, the majority view anticipates in-line to modestly better results on revenue with stable gross margin, while acknowledging that year-over-year EPS pressure reflects normalization from a strong comparative period rather than a structural shift in profitability dynamics.