HORMEL FOODS CORP (HRL) Stock Fundamental Analysis
USA - NYSE:HRL - US4404521001 - Common Stock
22.32 USD
+0.04 (+0.18%)
22.33 USD
+0.01 (+0.04%)
Taking everything into account, HRL scores 5 out of 10 in our fundamental rating. HRL was compared to 87 industry peers in the Food Products industry. HRL has an average financial health and profitability rating. HRL has a valuation in line with the averages, but it does not seem to be growing. Finally HRL also has an excellent dividend rating. These ratings could make HRL a good candidate for dividend investing.
1. Profitability
1.1 Basic Checks
HRL had positive earnings in the past year.
HRL had a positive operating cash flow in the past year.
In the past 5 years HRL has always been profitable.
HRL had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
HRL has a Return On Assets of 5.59%. This is in the better half of the industry: HRL outperforms 78.16% of its industry peers.
HRL's Return On Equity of 9.33% is fine compared to the rest of the industry. HRL outperforms 71.26% of its industry peers.
Looking at the Return On Invested Capital, with a value of 6.50%, HRL is in the better half of the industry, outperforming 71.26% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for HRL is significantly below the industry average of 28.37%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.59% | ||
| ROE | 9.33% | ||
| ROIC | 6.5% |
ROA(3y)6.47%
ROA(5y)7.15%
ROE(3y)11.2%
ROE(5y)12.15%
ROIC(3y)7.49%
ROIC(5y)7.95%
1.3 Margins
HRL has a better Profit Margin (6.26%) than 75.86% of its industry peers.
HRL's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 8.40%, HRL is in the better half of the industry, outperforming 72.41% of the companies in the same industry.
In the last couple of years the Operating Margin of HRL has declined.
HRL's Gross Margin of 16.36% is in line compared to the rest of the industry. HRL outperforms 45.98% of its industry peers.
HRL's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.4% | ||
| PM (TTM) | 6.26% | ||
| GM | 16.36% |
OM growth 3Y-3.33%
OM growth 5Y-6.88%
PM growth 3Y-5.43%
PM growth 5Y-8.11%
GM growth 3Y0.06%
GM growth 5Y-3.09%
2. Health
2.1 Basic Checks
HRL 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, HRL has more shares outstanding
The number of shares outstanding for HRL has been increased compared to 5 years ago.
The debt/assets ratio for HRL has been reduced compared to a year ago.
2.2 Solvency
HRL has an Altman-Z score of 3.48. This indicates that HRL is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 3.48, HRL is doing good in the industry, outperforming 79.31% of the companies in the same industry.
HRL has a debt to FCF ratio of 4.55. This is a neutral value as HRL would need 4.55 years to pay back of all of its debts.
HRL has a Debt to FCF ratio of 4.55. This is in the better half of the industry: HRL outperforms 78.16% of its industry peers.
HRL has a Debt/Equity ratio of 0.35. This is a healthy value indicating a solid balance between debt and equity.
HRL's Debt to Equity ratio of 0.35 is in line compared to the rest of the industry. HRL outperforms 55.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 4.55 | ||
| Altman-Z | 3.48 |
ROIC/WACC0.88
WACC7.37%
2.3 Liquidity
HRL has a Current Ratio of 2.47. This indicates that HRL is financially healthy and has no problem in meeting its short term obligations.
HRL's Current ratio of 2.47 is fine compared to the rest of the industry. HRL outperforms 73.56% of its industry peers.
A Quick Ratio of 1.12 indicates that HRL should not have too much problems paying its short term obligations.
HRL has a better Quick ratio (1.12) than 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.47 | ||
| Quick Ratio | 1.12 |
3. Growth
3.1 Past
HRL shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -6.96%.
HRL shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -1.91% yearly.
Looking at the last year, HRL shows a small growth in Revenue. The Revenue has grown by 0.65% in the last year.
HRL shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.65% yearly.
EPS 1Y (TTM)-6.96%
EPS 3Y-2.98%
EPS 5Y-1.91%
EPS Q2Q%-5.41%
Revenue 1Y (TTM)0.65%
Revenue growth 3Y1.54%
Revenue growth 5Y4.65%
Sales Q2Q%4.64%
3.2 Future
The Earnings Per Share is expected to grow by 3.52% on average over the next years.
Based on estimates for the next years, HRL will show a small growth in Revenue. The Revenue will grow by 1.69% on average per year.
EPS Next Y-10.4%
EPS Next 2Y-2.57%
EPS Next 3Y1.07%
EPS Next 5Y3.52%
Revenue Next Year1.78%
Revenue Next 2Y2.03%
Revenue Next 3Y2.16%
Revenue Next 5Y1.69%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 15.18, which indicates a correct valuation of HRL.
HRL's Price/Earnings ratio is a bit cheaper when compared to the industry. HRL is cheaper than 66.67% of the companies in the same industry.
When comparing the Price/Earnings ratio of HRL to the average of the S&P500 Index (25.51), we can say HRL is valued slightly cheaper.
With a Price/Forward Earnings ratio of 14.88, HRL is valued correctly.
70.11% of the companies in the same industry are more expensive than HRL, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 34.98, HRL is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.18 | ||
| Fwd PE | 14.88 |
4.2 Price Multiples
HRL's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, HRL is valued a bit cheaper than 64.37% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.56 | ||
| EV/EBITDA | 11.36 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-2.57%
EPS Next 3Y1.07%
5. Dividend
5.1 Amount
HRL has a Yearly Dividend Yield of 5.12%, which is a nice return.
The stock price of HRL dropped by -23.69% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
HRL's Dividend Yield is rather good when compared to the industry average which is at 5.17. HRL pays more dividend than 83.91% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.44, HRL pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.12% |
5.2 History
The dividend of HRL is nicely growing with an annual growth rate of 6.53%!
HRL has been paying a dividend for at least 10 years, so it has a reliable track record.
HRL has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)6.53%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
HRL pays out 83.32% of its income as dividend. This is not a sustainable payout ratio.
The dividend of HRL is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP83.32%
EPS Next 2Y-2.57%
EPS Next 3Y1.07%
22.32
+0.04 (+0.18%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners90.9%
Inst Owner Change2.78%
Ins Owners0.16%
Ins Owner Change0.04%
Market Cap12.28B
Revenue(TTM)12.06B
Net Income(TTM)754.53M
Analysts68
Price Target29.89 (33.92%)
Short Float %5.35%
Short Ratio3.4
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.12% |
Yearly Dividend1.12
Dividend Growth(5Y)6.53%
DP83.32%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-7.16%
Min EPS beat(2)-15.34%
Max EPS beat(2)1.03%
EPS beat(4)1
Avg EPS beat(4)-5.94%
Min EPS beat(4)-15.34%
Max EPS beat(4)1.03%
EPS beat(8)4
Avg EPS beat(8)-0.26%
EPS beat(12)6
Avg EPS beat(12)-1.4%
EPS beat(16)8
Avg EPS beat(16)-1.1%
Revenue beat(2)1
Avg Revenue beat(2)-0.25%
Min Revenue beat(2)-1.27%
Max Revenue beat(2)0.76%
Revenue beat(4)2
Avg Revenue beat(4)-0.22%
Min Revenue beat(4)-1.27%
Max Revenue beat(4)0.8%
Revenue beat(8)3
Avg Revenue beat(8)-1.03%
Revenue beat(12)3
Avg Revenue beat(12)-1.95%
Revenue beat(16)6
Avg Revenue beat(16)-0.84%
PT rev (1m)0%
PT rev (3m)-10.93%
EPS NQ rev (1m)-16.78%
EPS NQ rev (3m)-34.57%
EPS NY rev (1m)-2.77%
EPS NY rev (3m)-13.09%
Revenue NQ rev (1m)0.58%
Revenue NQ rev (3m)0.09%
Revenue NY rev (1m)0.07%
Revenue NY rev (3m)0.32%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.18 | ||
| Fwd PE | 14.88 | ||
| P/S | 1.02 | ||
| P/FCF | 19.56 | ||
| P/OCF | 13.19 | ||
| P/B | 1.52 | ||
| P/tB | 8.53 | ||
| EV/EBITDA | 11.36 |
EPS(TTM)1.47
EY6.59%
EPS(NY)1.5
Fwd EY6.72%
FCF(TTM)1.14
FCFY5.11%
OCF(TTM)1.69
OCFY7.58%
SpS21.92
BVpS14.7
TBVpS2.62
PEG (NY)N/A
PEG (5Y)N/A
Graham Number22.05
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.59% | ||
| ROE | 9.33% | ||
| ROCE | 8.34% | ||
| ROIC | 6.5% | ||
| ROICexc | 6.86% | ||
| ROICexgc | 16.2% | ||
| OM | 8.4% | ||
| PM (TTM) | 6.26% | ||
| GM | 16.36% | ||
| FCFM | 5.21% |
ROA(3y)6.47%
ROA(5y)7.15%
ROE(3y)11.2%
ROE(5y)12.15%
ROIC(3y)7.49%
ROIC(5y)7.95%
ROICexc(3y)8.08%
ROICexc(5y)8.91%
ROICexgc(3y)21.3%
ROICexgc(5y)22.65%
ROCE(3y)9.6%
ROCE(5y)10.2%
ROICexgc growth 3Y-7.22%
ROICexgc growth 5Y-11.81%
ROICexc growth 3Y-3.68%
ROICexc growth 5Y-13.2%
OM growth 3Y-3.33%
OM growth 5Y-6.88%
PM growth 3Y-5.43%
PM growth 5Y-8.11%
GM growth 3Y0.06%
GM growth 5Y-3.09%
F-Score5
Asset Turnover0.89
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 4.55 | ||
| Debt/EBITDA | 2.24 | ||
| Cap/Depr | 116.21% | ||
| Cap/Sales | 2.51% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 73.07% | ||
| Profit Quality | 83.2% | ||
| Current Ratio | 2.47 | ||
| Quick Ratio | 1.12 | ||
| Altman-Z | 3.48 |
F-Score5
WACC7.37%
ROIC/WACC0.88
Cap/Depr(3y)104.11%
Cap/Depr(5y)118.53%
Cap/Sales(3y)2.21%
Cap/Sales(5y)2.5%
Profit Quality(3y)103.03%
Profit Quality(5y)95.5%
High Growth Momentum
Growth
EPS 1Y (TTM)-6.96%
EPS 3Y-2.98%
EPS 5Y-1.91%
EPS Q2Q%-5.41%
EPS Next Y-10.4%
EPS Next 2Y-2.57%
EPS Next 3Y1.07%
EPS Next 5Y3.52%
Revenue 1Y (TTM)0.65%
Revenue growth 3Y1.54%
Revenue growth 5Y4.65%
Sales Q2Q%4.64%
Revenue Next Year1.78%
Revenue Next 2Y2.03%
Revenue Next 3Y2.16%
Revenue Next 5Y1.69%
EBIT growth 1Y-1.83%
EBIT growth 3Y-1.84%
EBIT growth 5Y-2.55%
EBIT Next Year15.4%
EBIT Next 3Y9.49%
EBIT Next 5Y9.03%
FCF growth 1Y-25.48%
FCF growth 3Y9.5%
FCF growth 5Y9.93%
OCF growth 1Y-15.41%
OCF growth 3Y8.13%
OCF growth 5Y6.54%
HORMEL FOODS CORP / HRL FAQ
What is the ChartMill fundamental rating of HORMEL FOODS CORP (HRL) stock?
ChartMill assigns a fundamental rating of 5 / 10 to HRL.
What is the valuation status of HORMEL FOODS CORP (HRL) stock?
ChartMill assigns a valuation rating of 4 / 10 to HORMEL FOODS CORP (HRL). This can be considered as Fairly Valued.
How profitable is HORMEL FOODS CORP (HRL) stock?
HORMEL FOODS CORP (HRL) has a profitability rating of 5 / 10.
Can you provide the financial health for HRL stock?
The financial health rating of HORMEL FOODS CORP (HRL) is 6 / 10.
Is the dividend of HORMEL FOODS CORP sustainable?
The dividend rating of HORMEL FOODS CORP (HRL) is 8 / 10 and the dividend payout ratio is 83.32%.