Shares of Sonoco Products plunged 9.3% to $46.25 after the 151-year-old packaging company delivered a third quarter that missed on nearly every metric that matters — and then slashed its outlook for the rest of the year.

  • The Earnings Miss Was Wide Enough to Shake Confidence. Adjusted earnings fell to $1.67 per diluted share from $1.92 a year earlier , missing the Street's $1.80 consensus by $0.13. Sales fell 4.2% to $2.04 billion , about $50 million light. Just last quarter, Sonoco beat expectations, posting $1.51 adjusted EPS against a $1.49 forecast while generating strong cash flow . The reversal signals that the cost headwinds management warned about in the spring are hitting harder and faster than investors had priced in.

  • A Massive Write-Down Reveals Overpayment for Past Deals. Sonoco's $732 million GAAP net loss reflected an $829 million non-cash goodwill impairment, with $802 million tied to its Consumer Packaging businesses in Europe, the Middle East, Africa, and Asia-Pacific — largely the Eviosys metal-can acquisition completed in late 2024. Goodwill impairments don't drain cash, but they are an admission that a business is worth less than what was paid for it. Goodwill and intangible assets together total roughly $5.1 billion, exceeding Sonoco's shareholder equity of $3.57 billion , leaving the balance sheet exposed to further write-downs if conditions worsen.

  • The Guidance Cut Tells Investors It's Not Just One Bad Quarter. Sonoco now targets full-year adjusted EPS of $5.30–$5.50 and adjusted EBITDA of $1.20–$1.25 billion . As recently as July, the company guided for $5.80–$6.20 in EPS and $1.25–$1.35 billion in EBITDA — meaning the midpoint of the profit forecast dropped roughly 8% in 90 days. Management blamed drought-weakened harvests pressuring food-can volumes and inflation in freight, energy, and raw materials.

  • Analysts Were Already Turning Cautious. Days before the report, Wells Fargo cut its price target to $53 from $56 , and Truist and UBS had also recently revised their targets downward . CEO Howard Coker pointed to a "Profitability Performance Plan" to cut costs and boost productivity , but investors are rightly asking whether self-help measures can offset a demand environment that keeps deteriorating. At roughly 8.5× forward earnings, the stock looks cheap — but only if management can prove the floor is in.