HORMEL FOODS CORP (HRL) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:HRL - US4404521001 - Common Stock
23.23 USD
+0.36 (+1.57%)
23.25 USD
+0.02 (+0.09%)
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. HRL also has an excellent dividend rating. With these ratings, HRL could be worth investigating further for dividend investing!.
1. Profitability
1.1 Basic Checks
In the past year HRL was profitable.
In the past year HRL had a positive cash flow from operations.
Each year in the past 5 years HRL has been profitable.
HRL had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
HRL's Return On Assets of 3.57% is fine compared to the rest of the industry. HRL outperforms 64.37% of its industry peers.
HRL has a Return On Equity of 6.05%. This is in the better half of the industry: HRL outperforms 60.92% of its industry peers.
HRL has a better Return On Invested Capital (5.99%) than 66.67% of its industry peers.
HRL had an Average Return On Invested Capital over the past 3 years of 6.47%. This is significantly below the industry average of 28.02%.
| 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
HRL's Profit Margin of 3.95% is fine compared to the rest of the industry. HRL outperforms 67.82% of its industry peers.
In the last couple of years the Profit Margin of HRL has declined.
HRL's Operating Margin of 7.94% is fine compared to the rest of the industry. HRL outperforms 72.41% of its industry peers.
HRL's Operating Margin has declined in the last couple of years.
HRL has a Gross Margin (15.70%) which is comparable to the rest of the industry.
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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), HRL is destroying 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.
HRL has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.48 indicates that HRL is not in any danger for bankruptcy at the moment.
HRL has a better Altman-Z score (3.48) than 75.86% of its industry peers.
The Debt to FCF ratio of HRL is 5.35, which is a neutral value as it means it would take HRL, 5.35 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 5.35, HRL is doing good in the industry, outperforming 79.31% of the companies in the same industry.
A Debt/Equity ratio of 0.36 indicates that HRL is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.36, HRL perfoms like the industry average, outperforming 57.47% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.36 | ||
| Debt/FCF | 5.35 | ||
| Altman-Z | 3.48 |
ROIC/WACC0.79
WACC7.56%
2.3 Liquidity
A Current Ratio of 2.47 indicates that HRL has no problem at all paying its short term obligations.
With a decent Current ratio value of 2.47, HRL is doing good in the industry, outperforming 72.41% of the companies in the same industry.
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 has a Quick ratio of 1.20. This is in the better half 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
The earnings per share for HRL have decreased strongly by -13.29% in the last year.
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.
Looking at the last year, HRL shows a small growth in Revenue. The Revenue has grown by 1.55% in the last 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
HRL is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 17.05% yearly.
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 Y8.13%
EPS Next 2Y7.79%
EPS Next 3Y7.32%
EPS Next 5Y17.05%
Revenue Next Year2.05%
Revenue Next 2Y2.15%
Revenue Next 3Y2.08%
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
The Price/Earnings ratio is 16.96, which indicates a correct valuation of HRL.
Based on the Price/Earnings ratio, HRL is valued a bit cheaper than the industry average as 60.92% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of HRL to the average of the S&P500 Index (27.19), we can say HRL is valued slightly cheaper.
With a Price/Forward Earnings ratio of 15.68, HRL is valued correctly.
HRL's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. HRL is cheaper than 67.82% of the companies in the same industry.
HRL is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 23.88, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.96 | ||
| Fwd PE | 15.68 |
4.2 Price Multiples
HRL's Enterprise Value to EBITDA is on the same level as the industry average.
62.07% of the companies in the same industry are more expensive than HRL, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.91 | ||
| EV/EBITDA | 12 |
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)2.08
PEG (5Y)N/A
EPS Next 2Y7.79%
EPS Next 3Y7.32%
5. Dividend
5.1 Amount
HRL has a Yearly Dividend Yield of 5.12%, which is a nice return.
Compared to an average industry Dividend Yield of 2.40, HRL pays a better dividend. On top of this HRL pays more dividend than 82.76% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 1.94, HRL pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.12% |
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.
The dividend of HRL is growing, but earnings are growing more, so the dividend growth is sustainable.
DP132.41%
EPS Next 2Y7.79%
EPS Next 3Y7.32%
23.23
+0.36 (+1.57%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners91.37%
Inst Owner Change0%
Ins Owners0.15%
Ins Owner Change0.06%
Market Cap12.78B
Revenue(TTM)12.11B
Net Income(TTM)478.20M
Analysts70.67
Price Target28.72 (23.63%)
Short Float %6.72%
Short Ratio3.78
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.12% |
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)1.28%
PT rev (3m)-3.91%
EPS NQ rev (1m)-0.12%
EPS NQ rev (3m)-8.31%
EPS NY rev (1m)0.97%
EPS NY rev (3m)-5.15%
Revenue NQ rev (1m)0.23%
Revenue NQ rev (3m)-0.54%
Revenue NY rev (1m)-0.04%
Revenue NY rev (3m)-0.63%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.96 | ||
| Fwd PE | 15.68 | ||
| P/S | 1.06 | ||
| P/FCF | 23.91 | ||
| P/OCF | 15.12 | ||
| P/B | 1.62 | ||
| P/tB | 9.61 | ||
| EV/EBITDA | 12 |
EPS(TTM)1.37
EY5.9%
EPS(NY)1.48
Fwd EY6.38%
FCF(TTM)0.97
FCFY4.18%
OCF(TTM)1.54
OCFY6.62%
SpS22.01
BVpS14.37
TBVpS2.42
PEG (NY)2.08
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 | 3.48 |
F-Score5
WACC7.56%
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 Y8.13%
EPS Next 2Y7.79%
EPS Next 3Y7.32%
EPS Next 5Y17.05%
Revenue 1Y (TTM)1.55%
Revenue growth 3Y-0.95%
Revenue growth 5Y4.73%
Sales Q2Q%1.52%
Revenue Next Year2.05%
Revenue Next 2Y2.15%
Revenue Next 3Y2.08%
Revenue Next 5Y3.65%
EBIT growth 1Y-5.53%
EBIT growth 3Y-9.26%
EBIT growth 5Y-2.02%
EBIT Next Year36.18%
EBIT Next 3Y11.82%
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 fundamental rating for HRL stock?
ChartMill assigns a fundamental rating of 5 / 10 to HRL.
What is the valuation status for HRL stock?
ChartMill assigns a valuation rating of 4 / 10 to HORMEL FOODS CORP (HRL). This can be considered as Fairly Valued.
What is the profitability of HRL stock?
HORMEL FOODS CORP (HRL) has a profitability rating of 5 / 10.
What is the earnings growth outlook for HORMEL FOODS CORP?
The Earnings per Share (EPS) of HORMEL FOODS CORP (HRL) is expected to grow by 8.13% in the next year.
Can you provide the dividend sustainability for HRL stock?
The dividend rating of HORMEL FOODS CORP (HRL) is 8 / 10 and the dividend payout ratio is 132.41%.