Packaging isn’t the type of investment opportunity people usually talk about with their friends down the pub. Cardboard boxes and paper products aren’t very exciting or associated with bumper returns. They are, however, essential, unlikely to get replaced by other technology, and not as commoditised and susceptible to competition as you might think. From an investor standpoint, these are enviable traits.
Three companies in the FTSE 100 specialise in packaging. One of them, DS Smith, appears to have been overlooked of late. The company, founded in 1940 by two cousins in London, provides its customers, mainly big supermarkets, industrials and online shops in Europe and North America, with packaging solutions supported by recycling and papermaking operations.
The economic environment is spooking investors. When consumers tighten
