HORMEL FOODS CORP (HRL) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:HRL - US4404521001 - Common Stock
24.12 USD
+0.45 (+1.9%)
24.12 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to HRL. HRL was compared to 87 industry peers in the Food Products industry. HRL has only an average score on both its financial health and profitability. HRL has a valuation in line with the averages, but on the other hand it scores bad on growth. Finally HRL also has an excellent dividend rating. This makes HRL very considerable for dividend investing!
1. Profitability
1.1 Basic Checks
HRL had positive earnings in the past year.
In the past year HRL had a positive cash flow from operations.
In the past 5 years HRL has always been profitable.
Each year in the past 5 years HRL had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 3.57%, HRL is doing good in the industry, outperforming 63.22% of the companies in the same industry.
HRL has a Return On Equity of 6.05%. This is comparable to the rest of the industry: HRL outperforms 59.77% of its industry peers.
With a decent Return On Invested Capital value of 5.99%, HRL is doing good in the industry, outperforming 66.67% 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 28.50%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.57% | ||
| ROE | 6.05% | ||
| ROIC | 5.99% |
ROA(3y)5.15%
ROA(5y)6.03%
ROE(3y)8.79%
ROE(5y)10.54%
ROIC(3y)6.47%
ROIC(5y)6.94%
1.3 Margins
Looking at the Profit Margin, with a value of 3.95%, HRL is in the better half of the industry, outperforming 67.82% of the companies in the same industry.
HRL's Profit Margin has declined in the last couple of years.
HRL has a better Operating Margin (7.94%) than 72.41% of its industry peers.
In the last couple of years the Operating Margin of HRL has declined.
HRL has a Gross Margin of 15.70%. This is comparable to the rest of the industry: HRL outperforms 43.68% of its industry peers.
HRL's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.94% | ||
| PM (TTM) | 3.95% | ||
| GM | 15.7% |
OM growth 3Y-8.39%
OM growth 5Y-6.45%
PM growth 3Y-21.05%
PM growth 5Y-16.01%
GM growth 3Y-3.32%
GM growth 5Y-3.74%
2. Health
2.1 Basic Checks
HRL has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for HRL has been increased compared to 1 year ago.
Compared to 5 years ago, HRL has more shares outstanding
HRL has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.56 indicates that HRL is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 3.56, HRL is doing good in the industry, outperforming 78.16% of the companies in the same industry.
HRL has a debt to FCF ratio of 5.35. This is a neutral value as HRL would need 5.35 years to pay back of all of its debts.
HRL has a Debt to FCF ratio of 5.35. This is amongst the best in the industry. HRL outperforms 80.46% of its industry peers.
A Debt/Equity ratio of 0.36 indicates that HRL is not too dependend on debt financing.
HRL has a Debt to Equity ratio (0.36) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.36 | ||
| Debt/FCF | 5.35 | ||
| Altman-Z | 3.56 |
ROIC/WACC0.79
WACC7.59%
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.
The Current ratio of HRL (2.47) is better than 72.41% of its industry peers.
HRL has a Quick Ratio of 1.20. This is a normal value and indicates that HRL is financially healthy and should not expect problems in meeting its short term obligations.
HRL's Quick ratio of 1.20 is fine compared to the rest of the industry. HRL outperforms 68.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.47 | ||
| Quick Ratio | 1.2 |
3. Growth
3.1 Past
HRL shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -13.29%.
Measured over the past years, HRL shows a decrease in Earnings Per Share. The EPS has been decreasing by -3.88% on average per year.
The Revenue has been growing slightly by 1.55% in the past year.
HRL shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.73% yearly.
EPS 1Y (TTM)-13.29%
EPS 3Y-9.2%
EPS 5Y-3.88%
EPS Q2Q%-23.81%
Revenue 1Y (TTM)1.55%
Revenue growth 3Y-0.95%
Revenue growth 5Y4.73%
Sales Q2Q%1.52%
3.2 Future
The Earnings Per Share is expected to grow by 17.05% on average over the next years. This is quite good.
Based on estimates for the next years, HRL will show a small growth in Revenue. The Revenue will grow by 3.65% on average per year.
EPS Next Y7.09%
EPS Next 2Y7.64%
EPS Next 3Y8.86%
EPS Next 5Y17.05%
Revenue Next Year2.09%
Revenue Next 2Y2.42%
Revenue Next 3Y1.51%
Revenue Next 5Y3.65%
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.
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
Based on the Price/Earnings ratio of 17.61, the valuation of HRL can be described as rather expensive.
HRL's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 26.61. HRL is valued slightly cheaper when compared to this.
Based on the Price/Forward Earnings ratio of 16.44, the valuation of HRL can be described as correct.
66.67% of the companies in the same industry are more expensive than HRL, based on the Price/Forward Earnings ratio.
HRL's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.01.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.61 | ||
| Fwd PE | 16.44 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as HRL.
HRL's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. HRL is cheaper than 63.22% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.83 | ||
| EV/EBITDA | 12.57 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PEG (NY)2.48
PEG (5Y)N/A
EPS Next 2Y7.64%
EPS Next 3Y8.86%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.88%, HRL is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 2.36, HRL pays a better dividend. On top of this HRL pays more dividend than 82.76% of the companies listed in the same industry.
HRL's Dividend Yield is rather good when compared to the S&P500 average which is at 1.87.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.88% |
5.2 History
The dividend of HRL has a limited annual growth rate of 4.90%.
HRL has been paying a dividend for at least 10 years, so it has a reliable track record.
HRL has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)4.9%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
HRL pays out 132.41% of its income as dividend. This is not a sustainable payout ratio.
HRL's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP132.41%
EPS Next 2Y7.64%
EPS Next 3Y8.86%
24.12
+0.45 (+1.9%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners91.41%
Inst Owner Change2.09%
Ins Owners0.16%
Ins Owner Change0.06%
Market Cap13.27B
Revenue(TTM)12.11B
Net Income(TTM)478.20M
Analysts68
Price Target28.61 (18.62%)
Short Float %5.88%
Short Ratio3.25
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.88% |
Yearly Dividend1.15
Dividend Growth(5Y)4.9%
DP132.41%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-5.19%
Min EPS beat(2)-15.34%
Max EPS beat(2)4.95%
EPS beat(4)2
Avg EPS beat(4)-4.26%
Min EPS beat(4)-15.34%
Max EPS beat(4)4.95%
EPS beat(8)5
Avg EPS beat(8)1.16%
EPS beat(12)6
Avg EPS beat(12)-1.1%
EPS beat(16)8
Avg EPS beat(16)-0.87%
Revenue beat(2)1
Avg Revenue beat(2)-0.76%
Min Revenue beat(2)-2.28%
Max Revenue beat(2)0.76%
Revenue beat(4)2
Avg Revenue beat(4)-0.5%
Min Revenue beat(4)-2.28%
Max Revenue beat(4)0.8%
Revenue beat(8)3
Avg Revenue beat(8)-0.95%
Revenue beat(12)3
Avg Revenue beat(12)-1.83%
Revenue beat(16)5
Avg Revenue beat(16)-1.37%
PT rev (1m)-4.29%
PT rev (3m)-4.29%
EPS NQ rev (1m)-0.25%
EPS NQ rev (3m)-8.44%
EPS NY rev (1m)-2.17%
EPS NY rev (3m)-18.73%
Revenue NQ rev (1m)-0.32%
Revenue NQ rev (3m)-0.54%
Revenue NY rev (1m)-0.26%
Revenue NY rev (3m)-0.51%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.61 | ||
| Fwd PE | 16.44 | ||
| P/S | 1.1 | ||
| P/FCF | 24.83 | ||
| P/OCF | 15.69 | ||
| P/B | 1.68 | ||
| P/tB | 9.98 | ||
| EV/EBITDA | 12.57 |
EPS(TTM)1.37
EY5.68%
EPS(NY)1.47
Fwd EY6.08%
FCF(TTM)0.97
FCFY4.03%
OCF(TTM)1.54
OCFY6.37%
SpS22.01
BVpS14.37
TBVpS2.42
PEG (NY)2.48
PEG (5Y)N/A
Graham Number21.04
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.57% | ||
| ROE | 6.05% | ||
| ROCE | 8% | ||
| ROIC | 5.99% | ||
| ROICexc | 6.36% | ||
| ROICexgc | 15.18% | ||
| OM | 7.94% | ||
| PM (TTM) | 3.95% | ||
| GM | 15.7% | ||
| FCFM | 4.41% |
ROA(3y)5.15%
ROA(5y)6.03%
ROE(3y)8.79%
ROE(5y)10.54%
ROIC(3y)6.47%
ROIC(5y)6.94%
ROICexc(3y)6.91%
ROICexc(5y)7.44%
ROICexgc(3y)17.7%
ROICexgc(5y)19.44%
ROCE(3y)8.65%
ROCE(5y)9.27%
ROICexgc growth 3Y-13.48%
ROICexgc growth 5Y-10.67%
ROICexc growth 3Y-10.55%
ROICexc growth 5Y-11.83%
OM growth 3Y-8.39%
OM growth 5Y-6.45%
PM growth 3Y-21.05%
PM growth 5Y-16.01%
GM growth 3Y-3.32%
GM growth 5Y-3.74%
F-Score5
Asset Turnover0.9
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.36 | ||
| Debt/FCF | 5.35 | ||
| Debt/EBITDA | 2.33 | ||
| Cap/Depr | 117.81% | ||
| Cap/Sales | 2.57% | ||
| Interest Coverage | 12.88 | ||
| Cash Conversion | 69.03% | ||
| Profit Quality | 111.74% | ||
| Current Ratio | 2.47 | ||
| Quick Ratio | 1.2 | ||
| Altman-Z | 3.56 |
F-Score5
WACC7.59%
ROIC/WACC0.79
Cap/Depr(3y)107.99%
Cap/Depr(5y)106.38%
Cap/Sales(3y)2.32%
Cap/Sales(5y)2.25%
Profit Quality(3y)111.74%
Profit Quality(5y)101.1%
High Growth Momentum
Growth
EPS 1Y (TTM)-13.29%
EPS 3Y-9.2%
EPS 5Y-3.88%
EPS Q2Q%-23.81%
EPS Next Y7.09%
EPS Next 2Y7.64%
EPS Next 3Y8.86%
EPS Next 5Y17.05%
Revenue 1Y (TTM)1.55%
Revenue growth 3Y-0.95%
Revenue growth 5Y4.73%
Sales Q2Q%1.52%
Revenue Next Year2.09%
Revenue Next 2Y2.42%
Revenue Next 3Y1.51%
Revenue Next 5Y3.65%
EBIT growth 1Y-5.53%
EBIT growth 3Y-9.26%
EBIT growth 5Y-2.02%
EBIT Next Year33.83%
EBIT Next 3Y10.79%
EBIT Next 5Y14.86%
FCF growth 1Y-47.11%
FCF growth 3Y-14.54%
FCF growth 5Y-6.82%
OCF growth 1Y-33.27%
OCF growth 3Y-9.36%
OCF growth 5Y-5.61%
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 132.41%.