美国纸与包装行业：牛熊之辩（英文_33页

U.S. Paper & Packaging Bull/Bear Debates Summary

Core Content Overview

This document provides a detailed analysis of the U.S. Paper & Packaging sector, focusing on key sub-sectors: Plastics, Rigids (Metal Can and Glass), and Containerboard. It outlines the Bull and Bear arguments for each sub-sector and specific companies, including their investment theses, growth potential, and risks. The report also includes analyst certifications, important disclosures, and a guide to the rating system used by Barclays Research.

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Main Sub-sectors and Investment Theses

Plastics Sub-sector

Subsector Thesis: Plastic packaging is viewed as a preferred sector due to above average growth potential, falling raw material prices, and limited earnings cyclicity.

Bull Case

• Above average organic growth potential driven by e-commerce, omni-channel marketing, and rising middle class in emerging markets.
• Margin expansion through productivity initiatives, material innovation, and volume leverage.
• Scale advantage across segments.
• Strong free cash flow (FCF) growth.

Bear Case

• Increased exposure to emerging markets could lead to volatile returns.
• Roll-up M&A strategy is difficult due to AVY’s dominant position in consolidated markets.
• Industrial & Healthcare Materials has been underfunded for years and may take time to recover.

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Rigids Sub-sector (Metal Can & Glass)

Metal Can Industry

• Subsector Thesis: Most defensive sub-sector with high global volume growth (2-3%) and limited price competition due to industry consolidation.

• Bull Case

  • Consolidated global supply base.
  • Positive secular mix shift from glass to metal cans.
  • Long-term supply agreements with near-instantaneous cost pass-through.
  • Limited cyclicality.

• Bear Case

  • Consolidated customer base.
  • Limited pricing power.
  • Minimal M&A optionality.
  • Margin expansion limited to productivity and mix shift.

Glass Industry

• Subsector Thesis: Negative industry dynamics, including a shift to metal cans, and above average earnings cyclicity offset the benefits of premium product offerings and high operating leverage.

• Bull Case

  • Consolidated supplier base.
  • Significant volume leverage.
  • Premium consumer preferred product.
  • Long-term supply contracts with high cost pass-through.

• Bear Case

  • Low global growth (0-1%).
  • Consolidated customer base.
  • Asset-intensive operations.
  • High earnings cyclicity.
  • Cost disadvantage compared to alternative substrates.

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Key Companies Analysis

Avery Dennison (AVY)

• OW Thesis: Strong organic growth and margin expansion with meaningful FCF growth.
• Bull Case
  • Multifaceted secular trends (e-commerce, emerging markets, automotive light weighting).
  • Productivity initiatives and material innovation.
  • Scale advantage.
  • Strong FCF growth.
• Bear Case
  • High exposure to emerging markets.
  • Difficult roll-up M&A strategy.
  • Underfunded Industrial & Healthcare Materials.

Bemis Company (BMS)

• OW Thesis: Risk/reward positively skewed due to downside reflected in share price and potential upside from cost reduction.
• Bull Case
  • Stable end markets with growth from substrate conversions, food safety, and healthcare.
  • Scale-driven cost advantages.
  • Rising ROIC from disciplined capital deployment.
  • Healthy balance sheet and dividend yield.
• Bear Case
  • Portfolio mix (50% specialty, 50% commodity).
  • Disappointing volume growth despite R&D spending.
  • Reinvestment into lower margin businesses.
  • High customer concentration.

Berry Global Group (BERY)

• OW Thesis: Long-term consolidation opportunities in the plastics industry.
• Bull Case
  • Scale advantages.
  • Proven M&A acumen.
  • Limited CPG exposure.
  • High resin pass-through.
  • Strategic evolution recognized.
• Bear Case
  • High commodity exposure.
  • Elevated hedge fund ownership.
  • CPG volumes under pressure.

Sealed Air (SEE)

• OW Thesis: Strategic shift toward SG&A cost reduction, equipment margins, and capital flexibility.
• Bull Case
  • Razor/razor blade model with 75% specialty products.
  • Long-term volume growth from fresh/natural food and e-commerce.
  • Limited cyclicality and input cost pass-through.
• Bear Case
  • Consolidation of food producers and zero-based budgeting could pressure volumes/margins.
  • Resin purchases lag compared to peers.
  • Uncertainty around new management strategy.

Crown Holdings (CCK)

• OW Thesis: Lowest risk for investors interested in stable FCF from the beverage can industry.
• Bull Case
  • Relative valuation gap to Ball Corporation.
  • Announced acquisition of Signode improves FCF and growth potential.
  • Flexibility to expand in emerging markets and increase specialty mix.
• Bear Case
  • Capital expansion despite weak returns.
  • High exposure to low-growth food can markets.
  • Perception of less disciplined management.

Owens-Illinois (OI)

• EW Thesis: Near-term growth from margin improvement and better mix of high barrier packaging, but organic volumes remain challenged.
• Bull Case
  • Annual growth in glass packaging end markets.
  • Management capabilities for manufacturing and commercial changes.
  • Asbestos liability fully accounted for, improving valuation.
• Bear Case
  • Asset-intensive and dated technology.
  • Secular share loss to aluminum cans.
  • High leverage for a cyclical business.

Silgan Holdings (SLGN)

• OW Thesis: 10% FCF yield, through-the-cycle earnings stability, and input cost inflation protection.
• Bull Case
  • Dispensing Systems acquisition offers synergy and growth opportunities.
  • Inflation protection with real-time input cost pass-through.
  • Strong customer relationships on long-term contracts.
• Bear Case
  • Low organic growth with seasonal volume dependence.
  • Limited synergy overlap with core business.
  • Weak plastics trends affecting performance.

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Containerboard Sub-sector

Subsector Thesis: Least preferred due to high earnings cyclicity, near peak margins, and historically low end market growth.

Bull Case

• Consolidated supplier base.
• Strong dividend yields.
• Tight supply/demand and rising input costs support higher prices.
• Upside from industrial end markets, e-commerce, and U.S. geographic exposure.

Bear Case

• High earnings cyclicity.
• Limited cost pass-through despite rising input costs.
• Low end market growth (typically in line with GDP).
• High asset intensity.

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Key Companies in Containerboard

International Paper (IP)

• UW Thesis: High valuations, rising input costs, and underfunded pension partially offset containerboard price hikes, dividend yield, and diversified business model.
• Bull Case
  • Industry leader in consolidated markets.
  • Emerging market expansion opportunities.
  • High dividend yield (40-50% of FCF).
  • Diversification benefits from newly acquired pulp business.
• Bear Case
  • High exposure to OCC cost inflation.
  • Large underfunded pension plan.
  • High leverage including pension gap.
  • Shared supply/demand burden with WestRock.

KapStone (KS)

• EW Thesis: Minimal market share, high exposure to virgin fiber, and increasing vertical integration are positives, but valuation is now fair.
• Bull Case
  • High exposure to virgin fiber assets.
  • Vertical integration opportunities.
  • Easing raw material inflation (especially OCC).
• Bear Case
  • Operational missteps and mill disruptions.
  • Lumpy revenue growth and low margins in distribution business.
  • Dependence on larger peers for pricing initiatives.

Packaging Corp. of America (PKG)

• EW Thesis: Best-in-class operator with limited market share, lower earnings volatility, and outsized benefits from consolidation, but fair valuation.
• Bull Case
  • Highest exposure to virgin fiber inputs.
  • Highest vertical integration in the industry.
  • Focus on value-added products and customer service.
• Bear Case
  • No plans to expand outside the U.S..
  • Limited product diversity and secular decline in copy paper.
  • Underutilized balance sheet.

WestRock (WRK)

• EW Thesis: Possibly at a near-term bottom, but limited catalysts for earnings acceleration due to OCC cost inflation.
• Bull Case
  • Historical synergy outperformance.
  • Simplified business aligned with core competencies.
  • Strategic acquisition of Multi Packaging Solutions.
• Bear Case
  • High exposure to OCC cost inflation.
  • Below industry average volume growth.
  • Shared supply/demand burden with International Paper.

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Others

Sonoco Products (SON)

• EW Thesis: Accelerated growth in the grocery store perimeter is expected, aided by easing raw material inflation.
• Bull Case
  • Shift to consumer packaging reduces earnings volatility.
  • Broad product portfolio by substrate.
  • Through-the-cycle dividend stability.
• Bear Case
  • Cyclical earnings with 45% still tied to industrial markets.
  • Limited M&A options in a competitive market.
  • Rising input costs (especially OCC) impact margins.

Veritiv Corp. (VRTV)

• UW Thesis: Sales growth continues to disappoint despite cost reduction.
• Bull Case
  • High financial and operational leverage.
  • Synergy capture ahead of schedule.
  • Services segment to be broken out in 2018.
• Bear Case
  • Secular decline in print and publishing segments.
  • Slowing synergy capture.
  • New restructuring program not expected to yield benefits until 2019.

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Analyst Certifications and Disclosures

• Analysts have financial interests in the companies they cover, and conflicts of interest may exist.
• Disclosure Legend outlines the nature of these relationships, including investment banking, market-making, and financial services.
• The rating system includes Overweight, Equal Weight, and Underweight for stocks, and Positive, Neutral, and Negative for industry views.
• Price targets reflect analysts’ expectations for stock performance over the next 12 months.

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Summary of Key Ratings and Price Targets (as of 15-Feb-2018)

Company	Rating	Price (USD)	Notes
Avery Dennison	OW	119.53	High exposure, M&A challenges
Bemis Company	OW	45.04	Self-funded turnaround, high customer concentration
Berry Global Group	OW	56.09	Consolidation opportunities
Sealed Air	OW	42.89	Strategic shift, FCF yield
Crown Holdings	OW	51.47	Relative valuation, acquisition potential
International Paper	UW	58.60	High valuations, underfunded pension
KapStone	EW	34.48	High virgin fiber exposure
Owens-Illinois	EW	21.70	Limited growth, high leverage
Packaging Corp. of America	EW	117.93	Best-in-class, fair valuation
Silgan Holdings	OW	28.48	High FCF yield, cost protection
Sonoco Products	EW	48.81	Grocery growth, fair valuation
Veritiv Corp.	UW	24.00	Sales growth under pressure
WestRock	EW	64.91	Near-term bottom, limited catalysts

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Conclusion

The U.S. Paper & Packaging sector is divided into three main sub-sectors, each with distinct growth drivers and risks. The Plastics sub-sector is seen as the most attractive due to growth potential and margin expansion. Rigids (Metal Can & Glass) are defensive with limited price competition. Containerboard is the least preferred due to high earnings cyclicity and low growth. Each company within these sub-sectors is evaluated based on organic growth, synergy potential, cost structure, and market exposure. Analysts emphasize the importance of diversification, cost control, and strategic M&A for long-term success.