PILGRIM'S PRIDE CORP (PPC) Stock Fundamental Analysis
NASDAQ:PPC - Nasdaq - US72147K1088 - Common Stock - Currency: USD
We assign a fundamental rating of 7 out of 10 to PPC. PPC was compared to 91 industry peers in the Food Products industry. PPC scores excellent points on both the profitability and health parts. This is a solid base for a good stock. PPC may be a bit undervalued, certainly considering the very reasonable score on growth These ratings could make PPC a good candidate for value and quality investing.
1. Profitability
1.1 Basic Checks
In the past year PPC was profitable.
In the past year PPC had a positive cash flow from operations.
PPC had positive earnings in each of the past 5 years.
In the past 5 years PPC always reported a positive cash flow from operatings.
1.2 Ratios
PPC has a better Return On Assets (11.02%) than 92.39% of its industry peers.
The Return On Equity of PPC (38.56%) is better than 98.91% of its industry peers.
Looking at the Return On Invested Capital, with a value of 20.80%, PPC belongs to the top of the industry, outperforming 97.83% of the companies in the same industry.
PPC had an Average Return On Invested Capital over the past 3 years of 12.54%. This is significantly below the industry average of 28.11%.
The last Return On Invested Capital (20.80%) for PPC is above the 3 year average (12.54%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.02% | ||
| ROE | 38.56% | ||
| ROIC | 20.8% |
ROA(3y)7.18%
ROA(5y)4.63%
ROE(3y)20.51%
ROE(5y)13.29%
ROIC(3y)12.54%
ROIC(5y)8.81%
1.3 Margins
PPC's Profit Margin of 6.72% is fine compared to the rest of the industry. PPC outperforms 77.17% of its industry peers.
PPC's Profit Margin has improved in the last couple of years.
The Operating Margin of PPC (9.77%) is better than 71.74% of its industry peers.
PPC's Operating Margin has improved in the last couple of years.
The Gross Margin of PPC (13.81%) is worse than 60.87% of its industry peers.
In the last couple of years the Gross Margin of PPC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.77% | ||
| PM (TTM) | 6.72% | ||
| GM | 13.81% |
OM growth 3Y82.65%
OM growth 5Y8.11%
PM growth 3Y207.12%
PM growth 5Y8.74%
GM growth 3Y11.86%
GM growth 5Y6.64%
2. Health
2.1 Basic Checks
PPC has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for PPC remains at a similar level compared to 1 year ago.
The number of shares outstanding for PPC has been reduced compared to 5 years ago.
The debt/assets ratio for PPC has been reduced compared to a year ago.
2.2 Solvency
PPC has an Altman-Z score of 3.39. This indicates that PPC is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of PPC (3.39) is better than 71.74% of its industry peers.
PPC has a debt to FCF ratio of 2.32. This is a good value and a sign of high solvency as PPC would need 2.32 years to pay back of all of its debts.
PPC has a Debt to FCF ratio of 2.32. This is amongst the best in the industry. PPC outperforms 83.70% of its industry peers.
A Debt/Equity ratio of 1.02 is on the high side and indicates that PPC has dependencies on debt financing.
PPC has a worse Debt to Equity ratio (1.02) than 71.74% of its industry peers.
Even though the debt/equity ratio score it not favorable for PPC, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.02 | ||
| Debt/FCF | 2.32 | ||
| Altman-Z | 3.39 |
ROIC/WACC2.59
WACC8.02%
2.3 Liquidity
A Current Ratio of 1.35 indicates that PPC should not have too much problems paying its short term obligations.
PPC has a Current ratio (1.35) which is comparable to the rest of the industry.
PPC has a Quick Ratio of 1.35. This is a bad value and indicates that PPC is not financially healthy enough and could expect problems in meeting its short term obligations.
PPC has a Quick ratio of 0.88. This is comparable to the rest of the industry: PPC outperforms 50.00% of its industry peers.
PPC does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.35 | ||
| Quick Ratio | 0.88 |
3. Growth
3.1 Past
PPC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 150.42%, which is quite impressive.
PPC shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 27.16% yearly.
The Revenue has been growing slightly by 2.40% in the past year.
Measured over the past years, PPC shows a quite strong growth in Revenue. The Revenue has been growing by 9.40% on average per year.
EPS 1Y (TTM)150.42%
EPS 3Y33.46%
EPS 5Y27.16%
EPS Q2Q%70.13%
Revenue 1Y (TTM)2.4%
Revenue growth 3Y6.56%
Revenue growth 5Y9.4%
Sales Q2Q%2.32%
3.2 Future
The Earnings Per Share is expected to decrease by -4.02% on average over the next years.
PPC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.13% yearly.
EPS Next Y1.99%
EPS Next 2Y-6.27%
EPS Next 3Y-7.33%
EPS Next 5Y-4.02%
Revenue Next Year0.97%
Revenue Next 2Y0.91%
Revenue Next 3Y1.41%
Revenue Next 5Y1.13%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less 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
Based on the Price/Earnings ratio of 7.56, the valuation of PPC can be described as very cheap.
Compared to the rest of the industry, the Price/Earnings ratio of PPC indicates a rather cheap valuation: PPC is cheaper than 91.30% of the companies listed in the same industry.
PPC is valuated cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 9.46, the valuation of PPC can be described as reasonable.
PPC's Price/Forward Earnings ratio is rather cheap when compared to the industry. PPC is cheaper than 92.39% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.76, PPC is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.56 | ||
| Fwd PE | 9.46 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PPC is valued cheaply inside the industry as 83.70% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, PPC is valued cheaply inside the industry as 90.22% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.74 | ||
| EV/EBITDA | 5.4 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates PPC does not grow enough to justify the current Price/Earnings ratio.
PPC has an outstanding profitability rating, which may justify a higher PE ratio.
PPC's earnings are expected to decrease with -7.33% in the coming years. This may justify a cheaper valuation.
PEG (NY)3.81
PEG (5Y)0.28
EPS Next 2Y-6.27%
EPS Next 3Y-7.33%
5. Dividend
5.1 Amount
PPC has a Yearly Dividend Yield of 13.98%, which is a nice return.
PPC's Dividend Yield is rather good when compared to the industry average which is at 4.71. PPC pays more dividend than 97.83% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.35, PPC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 13.98% |
5.2 History
PPC is new to the dividend game and has less than 3 years of track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DP0%
EPS Next 2Y-6.27%
EPS Next 3Y-7.33%
45.06
+0.17 (+0.38%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners19.42%
Inst Owner Change0%
Ins Owners0.07%
Ins Owner Change-0.03%
Market Cap10.68B
Analysts68.57
Price Target50 (10.96%)
Short Float %17.2%
Short Ratio5.67
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 13.98% |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)7.6%
Min EPS beat(2)-2.87%
Max EPS beat(2)18.08%
EPS beat(4)3
Avg EPS beat(4)14.9%
Min EPS beat(4)-2.87%
Max EPS beat(4)27.43%
EPS beat(8)7
Avg EPS beat(8)25.81%
EPS beat(12)10
Avg EPS beat(12)-181.78%
EPS beat(16)13
Avg EPS beat(16)-130.54%
Revenue beat(2)0
Avg Revenue beat(2)-3.63%
Min Revenue beat(2)-5.67%
Max Revenue beat(2)-1.59%
Revenue beat(4)0
Avg Revenue beat(4)-3.05%
Min Revenue beat(4)-5.67%
Max Revenue beat(4)-1.59%
Revenue beat(8)2
Avg Revenue beat(8)-1.98%
Revenue beat(12)5
Avg Revenue beat(12)-0.8%
Revenue beat(16)9
Avg Revenue beat(16)0.65%
PT rev (1m)-0.87%
PT rev (3m)-3.58%
EPS NQ rev (1m)0.47%
EPS NQ rev (3m)0.47%
EPS NY rev (1m)1.38%
EPS NY rev (3m)8.7%
Revenue NQ rev (1m)0.19%
Revenue NQ rev (3m)1.54%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)0.73%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.56 | ||
| Fwd PE | 9.46 | ||
| P/S | 0.59 | ||
| P/FCF | 7.74 | ||
| P/OCF | 5.79 | ||
| P/B | 3.41 | ||
| P/tB | 10.26 | ||
| EV/EBITDA | 5.4 |
EPS(TTM)5.96
EY13.23%
EPS(NY)4.76
Fwd EY10.57%
FCF(TTM)5.82
FCFY12.92%
OCF(TTM)7.79
OCFY17.28%
SpS75.82
BVpS13.21
TBVpS4.39
PEG (NY)3.81
PEG (5Y)0.28
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.02% | ||
| ROE | 38.56% | ||
| ROCE | 25.18% | ||
| ROIC | 20.8% | ||
| ROICexc | 29.56% | ||
| ROICexgc | 51.52% | ||
| OM | 9.77% | ||
| PM (TTM) | 6.72% | ||
| GM | 13.81% | ||
| FCFM | 7.68% |
ROA(3y)7.18%
ROA(5y)4.63%
ROE(3y)20.51%
ROE(5y)13.29%
ROIC(3y)12.54%
ROIC(5y)8.81%
ROICexc(3y)14.93%
ROICexc(5y)10.36%
ROICexgc(3y)22.39%
ROICexgc(5y)15.57%
ROCE(3y)15.18%
ROCE(5y)10.66%
ROICexcg growth 3Y91.19%
ROICexcg growth 5Y15.95%
ROICexc growth 3Y95.13%
ROICexc growth 5Y14.73%
OM growth 3Y82.65%
OM growth 5Y8.11%
PM growth 3Y207.12%
PM growth 5Y8.74%
GM growth 3Y11.86%
GM growth 5Y6.64%
F-Score6
Asset Turnover1.64
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.02 | ||
| Debt/FCF | 2.32 | ||
| Debt/EBITDA | 1.46 | ||
| Cap/Depr | 107.18% | ||
| Cap/Sales | 2.59% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 84.27% | ||
| Profit Quality | 114.23% | ||
| Current Ratio | 1.35 | ||
| Quick Ratio | 0.88 | ||
| Altman-Z | 3.39 |
F-Score6
WACC8.02%
ROIC/WACC2.59
Cap/Depr(3y)120.05%
Cap/Depr(5y)113.13%
Cap/Sales(3y)2.86%
Cap/Sales(5y)2.82%
Profit Quality(3y)68.51%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)150.42%
EPS 3Y33.46%
EPS 5Y27.16%
EPS Q2Q%70.13%
EPS Next Y1.99%
EPS Next 2Y-6.27%
EPS Next 3Y-7.33%
EPS Next 5Y-4.02%
Revenue 1Y (TTM)2.4%
Revenue growth 3Y6.56%
Revenue growth 5Y9.4%
Sales Q2Q%2.32%
Revenue Next Year0.97%
Revenue Next 2Y0.91%
Revenue Next 3Y1.41%
Revenue Next 5Y1.13%
EBIT growth 1Y121.66%
EBIT growth 3Y94.62%
EBIT growth 5Y18.28%
EBIT Next Year25.79%
EBIT Next 3Y0.13%
EBIT Next 5Y-0.26%
FCF growth 1Y638.91%
FCF growth 3YN/A
FCF growth 5Y36.59%
OCF growth 1Y556.55%
OCF growth 3Y82.68%
OCF growth 5Y24.46%