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SLGN

Silgan Holdings NYSE:SLGN Stock Report

Last Price

US$42.04

Market Cap

US$4.6b

7D

-1.2%

1Y

11.7%

Updated

30 Sep, 2022

Data

Company Financials +
SLGN fundamental analysis
Snowflake Score
Valuation5/6
Future Growth2/6
Past Performance2/6
Financial Health3/6
Dividends4/6

SLGN Stock Overview

Silgan Holdings Inc., together with its subsidiaries, manufactures and sells rigid packaging for consumer goods products in North America, Europe, and internationally.

Silgan Holdings Inc. Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Silgan Holdings
Historical stock prices
Current Share PriceUS$42.04
52 Week HighUS$48.61
52 Week LowUS$37.10
Beta0.75
1 Month Change-7.71%
3 Month Change0.071%
1 Year Change11.66%
3 Year Change42.65%
5 Year Change42.95%
Change since IPO1,420.09%

Recent News & Updates

Sep 17
Is Silgan Holdings (NYSE:SLGN) Using Too Much Debt?

Is Silgan Holdings (NYSE:SLGN) Using Too Much Debt?

The external fund manager backed by Berkshire Hathaway's Charlie Munger, Li Lu, makes no bones about it when he says...

Sep 05

Silgan Holdings: Great Performance Has Been Rewarded

Summary Silgan Holdings has performed quite well over the past year or so, with upside driven by strong revenue growth and improving profitability. Shares still look cheap, especially on a forward basis and from a cash flow perspective. Compared to similar businesses, the stock is closer to fair value territory, but it still likely has some upside potential to it. For many investors, the past year has been particularly difficult and volatile. Concerns over inflation, rising interest rates, and a potential recession have all sent the broader market declining. But one company that has performed remarkably well considering the circumstances is Silgan Holdings (SLGN). This firm, which focuses on the production and sale of metal containers, dispensing systems, and the running of metal and plastic closure operations, has held up well during the pandemic and, since then, has demonstrated continued attractive growth on both its top and bottom lines. Although the company is still very cheap and likely offers some nice upside potential, it has also seen its shares become more expensive relative to what some other players are trading at. For this reason and this reason alone, I've decided to lower my rating on the company from a 'strong buy' to a 'buy'. Fantastic performance A little over a year ago, on August 18th of 2021, I published an article detailing the investment worthiness of Silgan Holdings. In that article, I acknowledged that the company had done well to grow both its revenue and cash flows in the prior few years. At that time, shares of the company were cheap on both an absolute basis and relative to similar players. Due to this combination of growth and affordability, I ended up rating the company a 'strong buy', reflecting my belief that it would be very likely to significantly outperform the broader market for the foreseeable future. Since then, my call has proven to be correct. While the S&P 500 is down by 11.6%, shares of Silgan Holdings have generated a return for investors of 9.9%. Author - SEC EDGAR Data This significant return disparity has not been without cause. To see what I mean, we need only look at financial performance since the publication of that article. Back in 2020, the company generated revenue of $4.92 billion. For the 2021 fiscal year as a whole, sales came in at $5.68 billion. During that one-year window, the company saw significant growth in revenue across all three major operating segments that it runs. Net sales for the dispensing and specialty closures operations of the company grew by 26.2%, driven in large part by a 9% increase in unit volume and, secondarily, due to increased pricing as management pushed on costs associated with inflation to its customer base. Sales for the metal containers business grew a more modest 9.8%, largely as a result of higher raw material and other manufacturing costs being pushed onto customers, as well as a 4% increase in unit volume. And for the custom containers portion of the enterprise, sales rose by 8.8% because of the push-through of higher raw material costs, and because of a favorable mix of products relative to what the company reported for 2020. With revenue rising, profitability followed suit. Net income rose from $308.7 million to $359.1 million. Of course, we should pay attention to other profitability metrics. Operating cash flow for the company fell from $602.5 million to $556.8 million. But if we were to adjust for changes in working capital, it would have risen from $592.8 million to $711.9 million. Meanwhile, EBITDA for the company also expanded, climbing from $770.8 million in 2020 to $868 million last year. Although some companies have struggled to increase profitability as they push through some costs to their customers, it's clear that this was less of a concern for Silgan Holdings. Of course, this is not perfectly the case. The actual gross profit margin for the firm decreased by 1.4% in 2021 compared to the 2020 fiscal year because of the inability to push through all of its costs. Investors should be happy though since most of this was made up from a reduction, relative to sales, in the selling, general, and administrative expenses of the enterprise. Author - SEC EDGAR Data Fundamental performance for the company remained robust for the first half of the firm's 2022 fiscal year. Revenue during that time frame came in at $2.99 billion. This represents an increase of 15.4% compared to the $2.59 billion generated one year earlier. Once again, the company benefited from growth across all three of its operating segments. But the greatest expansion here involved the metal containers portion of the enterprise. Revenue under this segment jumped by 19.2%, climbing from $1.18 billion in the first half of 2021 to $1.41 billion the same time this year. According to management, this increase was driven largely by higher average selling prices as management continued to push through higher raw material and manufacturing costs to its customers. But this is not to say that the company is able to do this without any drawbacks in perpetuity. During that six-month window, unit volumes actually came in about 12% lower than what they were one year earlier. This does suggest some weakness in demand because of the higher pricing of the company's products. Management attributes this to a loading up of inventory by customers in the prior year period. In short, the argument is that, in anticipation of rising costs, customers basically bought sooner than they otherwise would have, frontloading their inventories. This rise in revenue still brought with it an increase in profitability. Net income for the first half of the year totaled $177.6 million. That compares favorably to the $167.8 million seen one year earlier. Operating cash flow did decline year over year, falling from negative $209.3 million to negative $351.9 million. But if we were to adjust for changes in working capital, it would have risen modestly from $312.1 to $329.5 million. Over that same window of time, EBITDA for the company also expanded, rising from $422.9 million to $451.9 million. Management has taken this opportunity to reward shareholders in the form of share buybacks. In March of this year, for instance, the company announced a $300 million share buyback program. During the first six months of the year, the firm bought back nearly 650,000 shares of stock for a combined $26.4 million, leaving $273.6 million in available capacity. Given the timing of cash flows for the business, it wouldn't be surprising to see these share repurchases pick up over the next few months if profits remain high. And in February, the company bought back all $300 million worth of the 4.75% senior notes that it had coming due in 2025. Though that interest rate is fairly low, it will save shareholders roughly $14.3 million, on a pre-tax basis, annually. When it comes to the 2022 fiscal year as a whole, management anticipates earnings per share, on an adjusted basis, of between $3.90 and $4.05. At the midpoint, that should translate to net income of $442.1 million. No guidance was given when it came to other profitability metrics. But if we assume that they would increase at the same rate the net income should, then we should anticipate adjusted operating cash flow of $832.7 million and EBITDA of $1.02 billion. Using these figures, we can easily value the company.

Sep 01
The Returns At Silgan Holdings (NYSE:SLGN) Aren't Growing

The Returns At Silgan Holdings (NYSE:SLGN) Aren't Growing

Finding a business that has the potential to grow substantially is not easy, but it is possible if we look at a few key...

Shareholder Returns

SLGNUS PackagingUS Market
7D-1.2%-2.1%-2.5%
1Y11.7%-27.2%-23.2%

Return vs Industry: SLGN exceeded the US Packaging industry which returned -27% over the past year.

Return vs Market: SLGN exceeded the US Market which returned -21.5% over the past year.

Price Volatility

Is SLGN's price volatile compared to industry and market?
SLGN volatility
SLGN Average Weekly Movement3.9%
Packaging Industry Average Movement5.1%
Market Average Movement6.9%
10% most volatile stocks in US Market15.6%
10% least volatile stocks in US Market2.8%

Stable Share Price: SLGN is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: SLGN's weekly volatility (4%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
198715,720Adam Greenleehttps://www.silganholdings.com

Silgan Holdings Inc., together with its subsidiaries, manufactures and sells rigid packaging for consumer goods products in North America, Europe, and internationally. It operates through three segments: Dispensing and Specialty Closures, Metal Containers, and Custom Containers. The Metal Containers segment manufactures and sells steel and aluminum containers for food products, such as pet food, vegetables, soups, proteins, tomato based products, adult nutritional drinks, fruits, and other miscellaneous food products, as well as general line metal containers primarily for chemicals.

Silgan Holdings Inc. Fundamentals Summary

How do Silgan Holdings's earnings and revenue compare to its market cap?
SLGN fundamental statistics
Market CapUS$4.63b
Earnings (TTM)US$368.87m
Revenue (TTM)US$6.08b

12.6x

P/E Ratio

0.8x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
SLGN income statement (TTM)
RevenueUS$6.08b
Cost of RevenueUS$5.11b
Gross ProfitUS$969.45m
Other ExpensesUS$600.57m
EarningsUS$368.87m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

Oct 26, 2022

Earnings per share (EPS)3.35
Gross Margin15.96%
Net Profit Margin6.07%
Debt/Equity Ratio247.3%

How did SLGN perform over the long term?

See historical performance and comparison

Dividends

1.5%

Current Dividend Yield

18%

Payout Ratio