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【出版时间及名称】：2010年3月美国软包装行业研究报告
【作者】：瑞士信贷
【文件格式】：pdf
【页数】：100
【目录或简介】：
Paper/Packaging's Next Phase
■ More Boring Yet More Exciting: We initiate coverage of five packaging
companies that are primarily involved in flexible packaging: AptarGroup, Inc.
(ATR, Neutral, $39.00 TP), Bemis (BMS, Outperform, $35.00 TP), Pactiv
(PTV, Outperform, $34.00 TP), Silgan (SLGN, Outperform, $66.00 TP) and
Sonoco (SON, Neutral, $32.00 TP). These companies rely on proprietary
technologies in order to earn superior returns on capital. However, given the
current environment in which the more commodity pulp/containerboard
segments are experiencing sharp cyclical recoveries helped by unusual
factors (such as “black liquor” and the Chilean earthquake), we believe the
flexible names may not perform as well as their more commodity-oriented
brethren over the next six months or so.
■ Pactiv Top Flexible Pick: Our favorite among these five flexible names is
Pactiv Corp. Based on our $34 one-year target price, the stock offers about
34% upside potential. Pactiv is a major producer of branded
kitchen/sandwich bags (under the Hefty brand) and plastic-food service
items. We would be buyers of PTV given its improving relationship with
Wal-Mart, its major relationship with Sysco, the improving situation of its
under-funded pension liability and the stock’s 15% 2010 free cash flow yield.
■ We Also Like Bemis and Silgan Here: Within the flexible names, we also
rate Bemis and Silgan Holdings Outperform. Bemis is the world's largest
producer of flexible packaging. In the wake of its just-completed Alcan
Packaging Food Americas acquisition, we estimate that the company's
operating EPS will grow much faster than the 6.7% 15-year average. Silgan
Holdings is the world’s largest producer of food cans, and participates in the
flexible packaging business through its closures and plastic containers
businesses. Silgan's founders and other board members still control more
than 25% of the outstanding shares. We see a potential one-year total return
of 24% in Bemis and 10% in Silgan Holdings.
■ Timing is Everything: The flexible packaging industry is generally fastergrowing
than the paper/packaging industry in general. The companies that
hold dominant positions tend to produce consistently returns well above the
cost of capital. However, we still remain more attracted to the more
commodity-oriented containerboard and pulp/paper plays given the cyclical
pricing recovery and the potential secular fiber supply constraints being felt
globally that should help the US names. However, as the more-cyclical
names become fully valued, and as monetary authorities begin to tighten
credit, perhaps later this year, the flexible names may become more
attractive. Within the universe of eight flexible and rigid packaging names we
cover, we consider Owens Illinois (OI, $35.26, OUTPERFORM [V], TP
$40.00) and Pactiv as our favorites
How We Rate the Flexible Packaging Companies
Aptar Group – Largest Players in Pumps and Valves
We are initiating coverage of Aptar Group with a Neutral rating and a $39 target price.
With the stock having recovered more than 60% from its March 2009 low, we believe the
company is about fairly valued when applying historical multiples to our EPS and EBITDA
estimates and based on our DCF analysis. Looking ahead, we expect EPS to grow slightly
slower than the 10.7% compounded average rate seen over the past 15 years. On the
other hand, we expect the company to be a bit less risky given its virtual zero net debt
position and established positions.
Bemis – World's Largest in Flexibles
We are initiating of Bemis Company with an Outperform rating and a $35 target price.
Despite the stock having almost doubled from its March 2009 low, we believe the
company is still attractively valued when applying historical multiples to our EPS and
EBITDA estimates and based on our DCF analysis. Looking ahead, we expect EPS to
grow significantly faster than the 6.7% compounded average rate seen over the past 15
years due to the benefits of the just-completed Alcan Packaging Food Americas
acquisition. We also expect the company to rapidly reduce its net debt-to-capital ratio from
about 40% currently to 30% or less by the end of 2012.
Pactiv – Tops in Foodservice/Food Packaging
We are initiating coverage of Pactiv Corporation with an Outperform rating and $34 target
price. We believe PTV is attractively valued when applying historical multiples to our EPS
and EBITDA estimates and based on our DCF analysis, despite the stock having jumped
about 150% from its March 2009 low. We expect operating EPS to grow at a below trend
2% in 2010 (as 2009’s resin cost benefits will not repeat), and then rise at an average
compound annual rate of 10% over the next five years, in-line with growth experienced
over the past 8 years. PTV sports the flexible companies’ highest 2010 free cash flow yield.
Silgan – Largest in U.S. Food Cans
We are initiating coverage of Silgan Holdings with an Outperform rating and a $66 target
price. We believe the company is still attractively valued when applying historical multiples
to our EPS and EBITDA estimates and based on our DCF analysis, despite the stock
having risen nearly 50% from its late 2008 low. We expect EPS to grow at a 6.0-7.0%
compounded average rate (with relatively low risk) unless the company undertakes a
transformative acquisition or major stock buyback. While this prospective growth rate
would be lower than the double digit pace seen over the past ten years, net debt has
plunged to only 16% of sales from 50% in 1998. The company announced on March 29th
that it had declared a two-for-one stock split, effective May 3rd.
Sonoco – World’s Largest in Composite Cans
We are initiating coverage of Sonoco Products with a Neutral rating and a $32 target price.
We believe the company is fairly valued when applying historical multiples to our EPS and
EBITDA estimates and based on our DCF analysis, with the stock having nearly doubled
from its March 2009 low. We expect EPS to grow significantly faster than the 3.1%
compounded average rate seen over the past 15 years owing to the benefits of (1) the
greater share of sales and income from the faster growing consumer packaging segment;
(2) a cyclical rebound in tubes and cores/paper; and (3) the company’s best balance sheet
in over 30 years. We believe the company will make one or more significant acquisitions in
the next year or so.
Table of contents
How We Rate the Flexible Packaging Companies 2
Initiating Coverage of Five Packaging Names 5
Flexible Packaging is Large and Growing Fast 5
Our Flexibles Forecast Could Be Conservative 6
What is “Flexible Packaging”? 7
Sensitivity Analysis 9
Accounting for Raw Material Inventories 12
Why Not Restate Our Models? 13
AptarGroup, Inc. (ATR) 15
AptarGroup, Inc. ATR 16
Company Profile 17
Management 18
Substantial Insider Ownership Remains 18
Consistent Growth While Reducing Leverage 19
Aptar Operates in Three Businesses 20
Valuation and Methodologies 22
Bemis Company, Inc. (BMS) 29
Bemis Company, Inc. BMS 30
Company Profile 31
Management 32
Substantial Insider Ownership Has Declined Steadily 32
Consistent Growth While Reducing Leverage 33
BMS Is World’s Largest in Flexible Packaging 34
Valuation and Methodologies 36
Pactiv Corp. (PTV) 43
Pactiv Corp. PTV 44
Company Profile 45
Management 46
Insiders Have Less Than 2% of the Stock 46
Deleveraging, Divestiture, and Buybacks Offset Slow Top-Line
Growth 47
PTV’s Two Segments: Consumer Products and Foodservice/Food
Packaging 47
Valuation and Methodologies 49
Silgan Holdings (SLGN) 57
Silgan Holdings SLGN 58
Company Profile 59
Management 60
Keeping Their Skin in the Game 60
Consistent Growth While Reducing Leverage 61
Silgan Operates in Three Businesses 62
Valuation and Methodologies 64
Sonoco Products (SON) 71
Sonoco Products SON 72
Company Profile 73
Management 74Substantial Insider Ownership Remains 74
Consistent Growth While Reducing Leverage 75
SON Breaks Its Businesses into Four Segments 76
Valuation and Methodologies 78
Appendix 85
10-Year Trailing PE Multiples vs. S&P 500 PE Multiples 85
Raw Materials 90
Polystyrene 90
Polyethylene 91
Polypropylene 92
Polyethylene Terephthalate 93
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