BROWN-FORMAN CORP-CLASS A (BF.A) Stock Fundamental Analysis
USA - NYSE:BF.A - US1156371007 - Common Stock
26.87 USD
-1.09 (-3.9%)
26.8 USD
-0.07 (-0.26%)
Taking everything into account, BF.A scores 6 out of 10 in our fundamental rating. BF.A was compared to 32 industry peers in the Beverages industry. BF.A scores excellent points on both the profitability and health parts. This is a solid base for a good stock. BF.A has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year BF.A was profitable.
BF.A had a positive operating cash flow in the past year.
Each year in the past 5 years BF.A has been profitable.
BF.A had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
BF.A has a better Return On Assets (10.33%) than 78.13% of its industry peers.
BF.A has a better Return On Equity (21.16%) than 68.75% of its industry peers.
BF.A has a Return On Invested Capital of 13.57%. This is in the better half of the industry: BF.A outperforms 75.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for BF.A is above the industry average of 10.95%.
The last Return On Invested Capital (13.57%) for BF.A is above the 3 year average (13.49%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.33% | ||
| ROE | 21.16% | ||
| ROIC | 13.57% |
ROA(3y)11.12%
ROA(5y)12.07%
ROE(3y)24.95%
ROE(5y)27.89%
ROIC(3y)13.49%
ROIC(5y)14.53%
1.3 Margins
Looking at the Profit Margin, with a value of 21.38%, BF.A belongs to the top of the industry, outperforming 93.75% of the companies in the same industry.
BF.A's Profit Margin has declined in the last couple of years.
BF.A has a better Operating Margin (30.02%) than 93.75% of its industry peers.
BF.A's Operating Margin has been stable in the last couple of years.
With an excellent Gross Margin value of 59.02%, BF.A belongs to the best of the industry, outperforming 84.38% of the companies in the same industry.
BF.A's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 30.02% | ||
| PM (TTM) | 21.38% | ||
| GM | 59.02% |
OM growth 3Y0.25%
OM growth 5Y-1.49%
PM growth 3Y0.86%
PM growth 5Y-2.33%
GM growth 3Y-1.02%
GM growth 5Y-1.4%
2. Health
2.1 Basic Checks
BF.A has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, BF.A has about the same amount of shares outstanding.
The number of shares outstanding for BF.A has been reduced compared to 5 years ago.
BF.A has a better debt/assets ratio than last year.
2.2 Solvency
BF.A has an Altman-Z score of 4.05. This indicates that BF.A is financially healthy and has little risk of bankruptcy at the moment.
BF.A has a Altman-Z score of 4.05. This is in the better half of the industry: BF.A outperforms 71.88% of its industry peers.
BF.A has a debt to FCF ratio of 4.63. This is a neutral value as BF.A would need 4.63 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 4.63, BF.A is doing good in the industry, outperforming 75.00% of the companies in the same industry.
BF.A has a Debt/Equity ratio of 0.59. This is a neutral value indicating BF.A is somewhat dependend on debt financing.
BF.A has a Debt to Equity ratio of 0.59. This is comparable to the rest of the industry: BF.A outperforms 50.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 4.63 | ||
| Altman-Z | 4.05 |
ROIC/WACC1.75
WACC7.75%
2.3 Liquidity
A Current Ratio of 2.79 indicates that BF.A has no problem at all paying its short term obligations.
BF.A's Current ratio of 2.79 is fine compared to the rest of the industry. BF.A outperforms 78.13% of its industry peers.
BF.A has a Quick Ratio of 1.06. This is a normal value and indicates that BF.A is financially healthy and should not expect problems in meeting its short term obligations.
BF.A's Quick ratio of 1.06 is fine compared to the rest of the industry. BF.A outperforms 71.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.79 | ||
| Quick Ratio | 1.06 |
3. Growth
3.1 Past
BF.A shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -20.29%.
The Earnings Per Share has been decreasing by -0.35% on average over the past years.
BF.A shows a decrease in Revenue. In the last year, the revenue decreased by -3.50%.
Measured over the past years, BF.A shows a small growth in Revenue. The Revenue has been growing by 3.40% on average per year.
EPS 1Y (TTM)-20.29%
EPS 3Y-0.77%
EPS 5Y-0.35%
EPS Q2Q%-12.2%
Revenue 1Y (TTM)-3.5%
Revenue growth 3Y0.35%
Revenue growth 5Y3.4%
Sales Q2Q%-2.84%
3.2 Future
BF.A is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 4.14% yearly.
The Revenue is expected to grow by 0.23% on average over the next years.
EPS Next Y-0.8%
EPS Next 2Y1.91%
EPS Next 3Y4.14%
EPS Next 5YN/A
Revenue Next Year-5.16%
Revenue Next 2Y-1.64%
Revenue Next 3Y0.23%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 16.28, which indicates a correct valuation of BF.A.
68.75% of the companies in the same industry are more expensive than BF.A, based on the Price/Earnings ratio.
BF.A is valuated rather cheaply when we compare the Price/Earnings ratio to 27.38, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 15.22, the valuation of BF.A can be described as correct.
BF.A's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. BF.A is cheaper than 65.63% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of BF.A to the average of the S&P500 Index (22.86), we can say BF.A is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.28 | ||
| Fwd PE | 15.22 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of BF.A indicates a somewhat cheap valuation: BF.A is cheaper than 65.63% of the companies listed in the same industry.
65.63% of the companies in the same industry are more expensive than BF.A, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.75 | ||
| EV/EBITDA | 11.92 |
4.3 Compensation for Growth
The excellent profitability rating of BF.A may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y1.91%
EPS Next 3Y4.14%
5. Dividend
5.1 Amount
BF.A has a Yearly Dividend Yield of 3.30%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.84, BF.A pays a better dividend. On top of this BF.A pays more dividend than 81.25% of the companies listed in the same industry.
BF.A's Dividend Yield is a higher than the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.3% |
5.2 History
The dividend of BF.A has a limited annual growth rate of 5.49%.
BF.A has been paying a dividend for at least 10 years, so it has a reliable track record.
BF.A has decreased its dividend in the last 3 years.
Dividend Growth(5Y)5.49%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
50.24% of the earnings are spent on dividend by BF.A. This is a bit on the high side, but may be sustainable.
BF.A's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP50.24%
EPS Next 2Y1.91%
EPS Next 3Y4.14%
26.87
-1.09 (-3.9%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)
Earnings (Next)
Inst Owners66.01%
Inst Owner Change-5.57%
Ins Owners2.1%
Ins Owner ChangeN/A
Market Cap12.70B
Analysts56.15
Price Target33.24 (23.71%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.3% |
Yearly Dividend0.89
Dividend Growth(5Y)5.49%
DP50.24%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-7.25%
Min EPS beat(2)-11.43%
Max EPS beat(2)-3.08%
EPS beat(4)1
Avg EPS beat(4)-3.29%
Min EPS beat(4)-11.43%
Max EPS beat(4)9.71%
EPS beat(8)3
Avg EPS beat(8)0.74%
EPS beat(12)3
Avg EPS beat(12)-5.91%
EPS beat(16)6
Avg EPS beat(16)-2.93%
Revenue beat(2)0
Avg Revenue beat(2)-4.88%
Min Revenue beat(2)-9.4%
Max Revenue beat(2)-0.37%
Revenue beat(4)0
Avg Revenue beat(4)-3.86%
Min Revenue beat(4)-9.4%
Max Revenue beat(4)-0.18%
Revenue beat(8)0
Avg Revenue beat(8)-5.28%
Revenue beat(12)2
Avg Revenue beat(12)-3.24%
Revenue beat(16)5
Avg Revenue beat(16)-1.49%
PT rev (1m)4.94%
PT rev (3m)-17.41%
EPS NQ rev (1m)-3.01%
EPS NQ rev (3m)-4.17%
EPS NY rev (1m)0.08%
EPS NY rev (3m)-11.34%
Revenue NQ rev (1m)-1.89%
Revenue NQ rev (3m)-2.63%
Revenue NY rev (1m)-0.1%
Revenue NY rev (3m)-6.76%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.28 | ||
| Fwd PE | 15.22 | ||
| P/S | 3.22 | ||
| P/FCF | 21.75 | ||
| P/OCF | 17.14 | ||
| P/B | 3.19 | ||
| P/tB | 9.01 | ||
| EV/EBITDA | 11.92 |
EPS(TTM)1.65
EY6.14%
EPS(NY)1.77
Fwd EY6.57%
FCF(TTM)1.24
FCFY4.6%
OCF(TTM)1.57
OCFY5.83%
SpS8.35
BVpS8.44
TBVpS2.98
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.33% | ||
| ROE | 21.16% | ||
| ROCE | 17.76% | ||
| ROIC | 13.57% | ||
| ROICexc | 14.55% | ||
| ROICexgc | 24.15% | ||
| OM | 30.02% | ||
| PM (TTM) | 21.38% | ||
| GM | 59.02% | ||
| FCFM | 14.79% |
ROA(3y)11.12%
ROA(5y)12.07%
ROE(3y)24.95%
ROE(5y)27.89%
ROIC(3y)13.49%
ROIC(5y)14.53%
ROICexc(3y)14.34%
ROICexc(5y)16.44%
ROICexgc(3y)23.06%
ROICexgc(5y)25.14%
ROCE(3y)17.75%
ROCE(5y)18.87%
ROICexcg growth 3Y-10.17%
ROICexcg growth 5Y-4.65%
ROICexc growth 3Y-12.83%
ROICexc growth 5Y-6.23%
OM growth 3Y0.25%
OM growth 5Y-1.49%
PM growth 3Y0.86%
PM growth 5Y-2.33%
GM growth 3Y-1.02%
GM growth 5Y-1.4%
F-Score4
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 4.63 | ||
| Debt/EBITDA | 1.85 | ||
| Cap/Depr | 180.46% | ||
| Cap/Sales | 3.98% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 58.25% | ||
| Profit Quality | 69.19% | ||
| Current Ratio | 2.79 | ||
| Quick Ratio | 1.06 | ||
| Altman-Z | 4.05 |
F-Score4
WACC7.75%
ROIC/WACC1.75
Cap/Depr(3y)227.59%
Cap/Depr(5y)185.59%
Cap/Sales(3y)4.66%
Cap/Sales(5y)3.82%
Profit Quality(3y)49.63%
Profit Quality(5y)65.74%
High Growth Momentum
Growth
EPS 1Y (TTM)-20.29%
EPS 3Y-0.77%
EPS 5Y-0.35%
EPS Q2Q%-12.2%
EPS Next Y-0.8%
EPS Next 2Y1.91%
EPS Next 3Y4.14%
EPS Next 5YN/A
Revenue 1Y (TTM)-3.5%
Revenue growth 3Y0.35%
Revenue growth 5Y3.4%
Sales Q2Q%-2.84%
Revenue Next Year-5.16%
Revenue Next 2Y-1.64%
Revenue Next 3Y0.23%
Revenue Next 5YN/A
EBIT growth 1Y5.8%
EBIT growth 3Y0.61%
EBIT growth 5Y1.86%
EBIT Next Year3.35%
EBIT Next 3Y4.44%
EBIT Next 5YN/A
FCF growth 1Y90.85%
FCF growth 3Y-18.93%
FCF growth 5Y-6.56%
OCF growth 1Y46.73%
OCF growth 3Y-13.87%
OCF growth 5Y-3.75%