Breaking Down Reynolds Consumer Products Inc. (REYN) Financial Health: Key Insights for Investors

You're looking at Reynolds Consumer Products Inc. (REYN) and wondering if the household staples giant can keep its footing against inflation and private-label pressure, and honestly, the latest numbers give us a clear map. Despite a mixed bag of volume-with retail volume down 2% in Q3 2025, largely due to a 13% decline in the Hefty Tableware foam business-the company is executing well, posting Q3 net revenues of $931 million, a solid 2.3% year-over-year increase. Here's the quick math: management is tightening the full-year 2025 Adjusted EBITDA guidance to a range of $655 million to $665 million, with Adjusted EPS expected to land between $1.60 and $1.64, showing a defintely resilient core business. The opportunity lies in their ability to continue gaining retail share in key areas like Hefty Waste & Storage, but you need to watch how quickly they can offset the structural headwind from the declining foam category to protect that $337 million to $345 million Adjusted Net Income target.

Revenue Analysis

You need to know where Reynolds Consumer Products Inc. (REYN) is making its money right now, because the growth story is getting very selective. The near-term picture shows a company that is holding its ground, with the Trailing Twelve Months (TTM) revenue ending Q3 2025 hitting approximately $3.71 billion. This is a near-flat performance, up just 0.71% year-over-year, which is actually a win in this environment, but it's defintely not a growth surge.

The company's revenue is built on four core segments, but we also need to look at the split between retail and non-retail sales. For the first half of 2025, the company's retail net revenues decreased 2% due to retailer destocking in the first quarter, but non-retail revenues-mostly aluminum sales to food service and industrial customers-increased. This mix shows the consumer staples (products that simplify daily life across U.S. households) business is facing inventory headwinds, but the industrial side is picking up some slack. You can dive deeper into the ownership structure and strategy in Exploring Reynolds Consumer Products Inc. (REYN) Investor Profile: Who's Buying and Why?

Segment Contribution and Growth Drivers

The latest quarterly data, Q2 2025, gives us the clearest view of which segments are pulling their weight. Total net revenues for the quarter were $938 million. Here's the quick math on how each segment contributed to that total, which is crucial for understanding where the company is investing its capital. The segments are not all moving in the same direction.

• Hefty Waste & Storage: This is the clear winner, with net revenues increasing by $11 million to $255 million in Q2 2025, powered by a 6% increase in retail volume. Strong growth in products like Hefty Fabuloso waste bags is driving this.
• Reynolds Cooking & Baking: This segment, which includes the iconic Reynolds Wrap aluminum foil, saw net revenues rise to $295 million in Q2 2025. The increase was driven by higher non-retail revenues, but retail net revenues still declined 3%.
• Hefty Tableware: This is the segment facing the most pressure right now. Net revenues decreased by $9 million to $242 million in Q2 2025, with a 5% retail volume decline driven exclusively by foam product declines. That's a structural risk.
• Presto Products: A modest increase in net revenues to $153 million in Q2 2025, with a 1% rise in retail volume. Steady, but not a growth engine.

What this breakdown shows is a tale of two Hefty brands: the trash bag business is strong, but the foam tableware business is struggling against volume and pricing pressure. You need to watch that Tableware segment closely for a turnaround plan.

Near-Term Revenue Outlook and Risks

The full-year 2025 revenue guidance has been tightened, and the company now expects net revenues to be flat to down 1% compared to the 2024 figure of $3,695 million. This is an improvement from earlier guidance that was 'down low single digits,' but it still signals a year of stabilization, not expansion. The company is implementing pricing actions to offset higher input costs, including tariffs on aluminum, but the benefit is being balanced by lower retail volumes in certain areas.

The biggest risk remains the Hefty Tableware segment's reliance on foam products, which are clearly losing volume. The opportunity is in the Hefty Waste & Storage segment, where a 6% volume gain proves that product innovation, like the Hefty Fabuloso line, can still drive substantial growth in a mature market. You should expect management to lean heavily into the successful Waste & Storage playbook and continue to optimize the Presto Products portfolio to cut the dead weight.

Profitability Metrics

You want to know if Reynolds Consumer Products Inc. (REYN) is making money efficiently, and the quick answer is yes, but its margins are thinner than the broader consumer staples sector. The company is managing a high-cost structure well, but it doesn't have the premium pricing power of its peers; it's a high-volume, lower-margin business.

Looking at the Trailing Twelve Months (TTM) data ending September 30, 2025, Reynolds Consumer Products generated $3,707 million in revenue. Here's the quick math on how that revenue translated to profit:

• Gross Profit Margin: 25.04%
• Operating Profit Margin: 14.22%
• Net Profit Margin: 8.23%

Honestly, these margins show a solid, if unspectacular, performance for a company dealing with commodity costs like aluminum and plastic. The core business is profitable, but it's defintely not a high-margin play.

Margin Trends and Operational Efficiency

The trend in profitability is what should concern you most. While the Net Profit Margin of about 8.44% is within its historical range, the company's Gross Margin has been in a long-term decline, averaging a decrease of 3.1% per year. This is the clearest sign of a persistent operational challenge.

Here's what that cost pressure looks like in real numbers:

• The current Gross Margin of approximately 25.34% is significantly lower than its historical high of 30.22%.
• The Operating Margin, which tells you how well management controls costs like Selling, General, and Administrative (SG&A), has also fallen to about 14.14% from a historical high of 18.91%.

What this estimate hides is the constant battle to align pricing with higher input costs. The company is actively working to offset this, including strategic investments in cost savings and revenue growth initiatives, but the overall margin compression shows the difficulty of passing all cost increases on to consumers in a competitive market.

Peer Comparison: Where REYN Stands

To be fair, you need to compare Reynolds Consumer Products Inc. to its peers in the broader Consumer Staples sector. We can use the metrics for the Consumer Staples Sector SPDR (XLP) exchange-traded fund (ETF) as a proxy for the industry average, which gives a much clearer picture of REYN's relative position. This comparison highlights REYN's lower-margin, manufacturing-heavy model.

The gap in Gross Margin is the key takeaway here. Reynolds Consumer Products is not a premium-brand company like some peers; its profitability is highly sensitive to commodity price fluctuations. The lower-than-average Operating Margin suggests that while the company is making progress on cost control, it still has ground to cover to match the operational efficiency of the sector's top performers. You can read more in the full analysis: Breaking Down Reynolds Consumer Products Inc. (REYN) Financial Health: Key Insights for Investors.

Debt vs. Equity Structure

You're looking at Reynolds Consumer Products Inc. (REYN) and wondering how they pay for their massive production and distribution network. Honestly, the company leans heavily on debt, but it manages that leverage carefully within a stated target range. This is a common strategy for mature, cash-flow-stable Consumer Staples businesses, but it means a higher debt-to-equity ratio than many of its peers.

As of September 30, 2025, the company's total reported debt stood at $1.629 billion. Subtracting the $53 million in cash and cash equivalents, the Net Debt was $1.576 billion. This debt is mostly long-term, which is typical for funding capital expenditures and acquisitions, not just covering day-to-day operations.

• Total Debt (Q3 2025): $1.629 billion
• Net Debt (Q3 2025): $1.576 billion
• Key Debt Components: A $700 million senior secured revolving credit facility (due 2029) and a $1.645 billion senior secured term loan B (due 2032).

Here's the quick math on the balance: Reynolds Consumer Products Inc.'s debt-to-equity (D/E) ratio was 0.81 as of late October 2025. [cite: 9 in step 1] To be fair, a D/E ratio under 1.0 is generally considered moderate, suggesting the company's assets are financed more by equity than debt. Still, when you look at the industry, major US Consumer Staples companies often run lower, with many peers in the 0.23 to 0.48 range. This higher figure for Reynolds Consumer Products Inc. reflects its history of private equity ownership and its strategy to maximize returns on equity, but it also means less cushion if earnings drop defintely.

The company is a trend-aware realist about its debt load. Its primary metric for managing this is the Net Debt to Trailing Twelve Months Adjusted EBITDA, which stood at 2.4x on September 30, 2025. This is right in the middle of their stated target leverage range of 2.0x to 2.5x, [cite: 5 in step 1] showing a deliberate, consistent use of debt financing to fuel growth and shareholder returns while keeping interest payments manageable.

You should also note the recent activity. In the first quarter of 2025, the company refinanced the remaining $1.645 billion of its term loan facility, extending the maturity out to 2032. [cite: 10 in step 1] This move locks in financing and pushes repayment risk far into the future. S&P Global Ratings affirmed the company's 'BB+' issuer credit rating with a stable outlook in November 2025, [cite: 14 in step 1] confirming the market views its debt management as stable, if not investment-grade. Plus, the company made a voluntary principal payment of $50 million on its term loan subsequent to the third quarter, a clear action to reduce long-term interest expense.

For a deeper dive into all aspects of the company's financial health, check out Breaking Down Reynolds Consumer Products Inc. (REYN) Financial Health: Key Insights for Investors.

Liquidity and Solvency

You need to know if Reynolds Consumer Products Inc. (REYN) can cover its near-term bills and keep funding its business without stress. The quick takeaway is that REYN maintains a solid, if slightly inventory-dependent, liquidity position, and its cash flow generation remains strong enough to service its debt and invest in growth.

We see this clearly in the liquidity ratios for the Trailing Twelve Months (TTM) ending September 30, 2025. The company's ability to cover short-term obligations is defintely there, but it relies heavily on its inventory, which is typical for a consumer packaged goods company.

Current and Quick Ratios: A Closer Look

The Current Ratio and Quick Ratio (Acid-Test Ratio) tell us how easily REYN can turn assets into cash to pay its current liabilities. The difference between the two is that the Quick Ratio strips out inventory, which is usually the least liquid current asset. Here is the breakdown based on the most recent TTM data:

• Current Ratio: 1.94
• Quick Ratio: 0.80

A Current Ratio of 1.94 means REYN has $1.94 in current assets for every dollar of current liabilities. That's a strong position, well above the 1.0 benchmark. But, the Quick Ratio drops significantly to 0.80. This tells you that without selling its inventory-things like Hefty trash bags and Reynolds Wrap-the company would fall short of covering all its current liabilities immediately. This isn't a red flag for a manufacturer, but it's a key point: liquidity is tied to inventory turnover. It's a healthy but inventory-heavy balance sheet.

Analysis of Working Capital Trends

Working capital (Current Assets minus Current Liabilities) management has been disciplined, which is a big plus. For the TTM period ending September 30, 2025, the change in inventory was a modest draw of $-15 million, and the change in accounts receivable was a small draw of $-4 million. This suggests the company is keeping its inventory levels relatively stable and is collecting its cash from customers efficiently. This tight management helps free up cash, which you can see in the strong operating cash flow. If working capital starts ballooning-especially inventory-that's when you need to worry about cash getting tied up.

Cash Flow Statements Overview (TTM September 2025)

The cash flow statement is where the rubber meets the road. It shows you exactly where the cash is coming from and where it's going. REYN's cash flow shows a consistent pattern of generating strong operational cash, using a portion for capital expenditures (CapEx), and then directing the remainder toward debt repayment and dividends.

Here's the quick math: Operating Cash Flow of $422 million easily covers the Investing Cash Flow of $-165 million. That leaves a substantial amount of free cash flow to pay down debt and fund the dividend. In fact, REYN has been actively paying down debt, with a net debt repayment of $108 million in the TTM period. This focus on deleveraging is a major strength, reducing long-term financial risk and bringing the Net Debt Leverage to a manageable 2.3x as of March 31, 2025.

Potential Liquidity Strengths

The biggest strength is the OCF generation and the proactive debt management. Plus, the company refinanced a portion of its term loan in Q1 2025, extending the maturity to 2032 and upsizing its undrawn revolving credit facility to $700 million. This move dramatically improves financial flexibility and removes any near-term liquidity concerns. You can read more about what drives this stability in the company's core principles: Mission Statement, Vision, & Core Values of Reynolds Consumer Products Inc. (REYN).

Valuation Analysis

You're asking the core question: Is Reynolds Consumer Products Inc. (REYN) a buy, a hold, or a sell right now? Based on current multiples and analyst sentiment in November 2025, the stock appears to be fairly valued, leaning toward a slight undervaluation when you consider its forward earnings power.

The market is pricing in the company's cautious fiscal year 2025 outlook, which projects net revenues to be flat to down 1% compared to 2024's $3,695 million. This near-term revenue softness is balanced by a defensible brand portfolio and cost discipline. The stock is priced right, but it's defintely not cheap.

Here's the quick math on the key valuation multiples (as of November 2025), which are crucial for a consumer staples business like Reynolds Consumer Products Inc. (REYN) that trades more on stability than explosive growth:

• Price-to-Earnings (P/E) Ratio: The current trailing twelve months (TTM) P/E is approximately 16.82. This is slightly below the broader Household Products industry average of around 17.78x, suggesting a small discount.
• Forward P/E: Based on the mid-point of the company's adjusted EPS guidance for FY 2025 of $1.60 to $1.64, the forward P/E is about 14.16. This lower forward multiple signals that earnings are expected to grow relative to the current price, which is a positive sign for value investors.
• Price-to-Book (P/B) Ratio: At approximately 2.34, the P/B is near its 10-year low of 2.32, indicating a potentially attractive entry point relative to the company's book value.
• Enterprise Value-to-EBITDA (EV/EBITDA): This metric, which accounts for debt, sits at about 10.27. Given the company's adjusted EBITDA guidance for 2025 is between $655 million and $665 million, this leverage multiple is reasonable for a stable cash-flow business.

The stock's movement over the last 12 months shows volatility, trading in a 52-week range between a low of $20.91 and a high of $28.66. The closing price as of mid-November 2025 was around $24.23, putting it closer to the low end of that range. The stock is down about 7.7% year-to-date in 2025. This downward drift reflects market concerns over raw material cost headwinds, particularly aluminum and resin, which can pressure profit margins if not offset by pricing power.

Wall Street analysts have largely maintained a neutral stance. The consensus rating from a pool of analysts is 'Hold'. The average 12-month price target is approximately $26.75, which suggests an upside of around 10.42% from the current price. This consensus implies that while the stock is not expected to outperform the market dramatically, it is not seen as a major risk either. For a deeper dive into the company's qualitative foundation, you should review the Mission Statement, Vision, & Core Values of Reynolds Consumer Products Inc. (REYN).

For income-focused investors, the dividend profile remains steady. Reynolds Consumer Products Inc. (REYN) pays an annual dividend of $0.92 per share, resulting in a dividend yield of approximately 3.80%. The payout ratio is sustainable, sitting around 57% of earnings. This means the company is comfortably covering its dividend, which is what you want to see in a consumer staples play.

Your next step should be to model the impact of aluminum and resin price fluctuations on that $655M to $665M adjusted EBITDA forecast. That's the real near-term risk.

Risk Factors

You need to know that for Reynolds Consumer Products Inc. (REYN), the primary risks in the 2025 fiscal year center on volatile raw material costs and a challenging consumer environment, which together pressure margins and revenue. The company is defintely executing a clear strategy to counter these headwinds, but the timing of those offsets is the key uncertainty.

The biggest external risk is the cost of key inputs. We're seeing significant tariff-related cost headwinds, which management estimated earlier in 2025 could be between $100 million and $200 million annually, primarily from aluminum for their foil products. Plus, the overall consumer market is soft; U.S. consumer confidence dropped by about 15 points in the first half of 2025, which makes it harder to pass on price increases without losing volume. That's a tough spot to be in.

Operationally, the Hefty Tableware segment is a clear weak spot. Volume for their foam dishes is in a double-digit decline, creating a roughly 3-point headwind on total retail volume. This product category is shrinking, and that directly impacts the top line. For the full year, REYN's net revenues are projected to be flat to down 1% compared to the 2024 net revenues of $3.695 billion. Still, the core business is holding up, with retail volume in other categories performing at or above market levels.

The financial health picture is mixed, too. While the company has a moderate debt-to-equity ratio of 0.81 and a solid current ratio of 1.85, its Altman Z-Score of 2.54 puts it in the 'grey area,' suggesting some financial stress. This is manageable, but it means they have less cushion if the cost pressures intensify. The company is also absorbing approximately $40 million in pre-tax costs in 2025 for strategic initiatives and CEO transition, which temporarily weighs on net income.

Here is the quick math on the expected 2025 financial outcome, which already reflects the risk environment:

The good news is that management is not sitting still. Their mitigation strategy is clear and action-oriented:

• Pricing Power: Implementing pricing actions expected to provide a 2 to 4 point recovery to offset the tariff and commodity cost increases.
• Cost Control: Driving productivity enhancements and cost reductions, plus leveraging their strong U.S.-centric manufacturing base.
• Strategic Investment: Increasing capital spending by $30 million to $40 million in 2025 for automation and high-return projects to improve long-term margins.
• Innovation: Focusing on new products like Hefty ECOSAVE compostable cutlery and Reynolds Kitchens Air Fryer cups to drive share gains and offset foam declines.

They are also aggressively deleveraging, having reduced their net debt leverage to a comfortable 2.3x trailing twelve months Adjusted EBITDA as of March 31, 2025. This financial discipline helps offset the volatility from raw materials. If you want to dive deeper into the ownership structure behind the stock's resilience, you should read Exploring Reynolds Consumer Products Inc. (REYN) Investor Profile: Who's Buying and Why?

Growth Opportunities

You need to know where Reynolds Consumer Products Inc. (REYN) is finding its growth, because the headline revenue numbers for the 2025 fiscal year are defintely soft. The company is projecting Net Revenues to be flat to down 1% compared to the 2024 figure of $3,695 million, so the real story is in margin expansion and category share gains, not top-line explosion. They are pulling on three clear levers: product innovation, cost discipline, and their unique market positioning.

The core of their strategy is a three-pillar program that focuses on growth, aggressive cost reduction, and investments that deliver a clear return on investment (ROI). This is a classic playbook for a mature consumer packaged goods (CPG) company, but it's critical for navigating current commodity cost pressures. The goal is to drive earnings even with a flat sales environment.

Here's the quick math on their earnings outlook: the company has lifted its guidance, now expecting Adjusted Net Income for 2025 to land between $337 million and $345 million, which translates to an Adjusted Earnings Per Share (EPS) of $1.60 to $1.64. That earnings resilience comes from successful execution on the cost side, offsetting the revenue headwinds.

Key Growth Drivers: Innovation and Market Share

Product innovation is the engine driving their category outperformance. They are focusing on premium, value-added products that command better margins, even as their Hefty Tableware segment continues to face declines due to foam-related challenges. The growth segments are proving their worth:

• Hefty Press to Close: Rolling out nationally in 2025, which is a major distribution win.
• Hefty Fabuloso: Waste bags that are driving strong growth in the Hefty Waste & Storage segment.
• Reynolds Kitchens Air Fryer Liners: Recognized as a 2025 new product pacesetter, showing they are aligned with modern cooking trends.

This strategy is working; the company is seeing retail share increases in multiple categories like Hefty waste bags, Reynolds Wrap, and store brand food bags. Honesty, in a low-growth category, stealing market share is how you win.

Competitive Advantages and Strategic Positioning

Reynolds Consumer Products Inc. (REYN) benefits from two distinct competitive advantages that position it well for long-term stability and growth. First, its business model is a powerful mix of both branded products (like Reynolds Wrap and Hefty) and a strong store brand portfolio. This dual-brand approach lets them capture sales across different consumer price points, which is vital when consumer spending tightens.

Second, their self-described US-centric business model is a significant advantage in a volatile global market. This focus simplifies their supply chain and helps them manage costs more effectively. For example, the Reynolds Wrap brand benefits from the company being the only vertically integrated foil manufacturer in the U.S., which gives them a distinct edge in managing aluminum input costs and supply.

The company is also making strategic investments, allocating approximately $40 million (pre-tax) toward strategic initiatives and CEO transition costs to unlock future growth and cost savings. They are committed to disciplined cost management in manufacturing and supply chain, which should continue to flow through to the Adjusted EBITDA, which is projected to be between $655 million and $665 million for 2025.

For a deeper dive into who is betting on this strategy, you should read Exploring Reynolds Consumer Products Inc. (REYN) Investor Profile: Who's Buying and Why?