Primo Water Corporation (PRMW) Fundamental Analysis & Valuation

NYSE:PRMW • CA74167P1080

Current stock price

24.21 USD
-0.23 (-0.94%)
At close:
24.26 USD
+0.05 (+0.21%)
After Hours:

This PRMW fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

6

1. PRMW Profitability Analysis

1.1 Basic Checks

  • In the past year PRMW was profitable.
  • In the past year PRMW had a positive cash flow from operations.
  • In multiple years PRMW reported negative net income over the last 5 years.
  • PRMW had a positive operating cash flow in each of the past 5 years.
PRMW Yearly Net Income VS EBIT VS OCF VS FCFPRMW Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 0 100M -100M 200M 300M

1.2 Ratios

  • Looking at the Return On Assets, with a value of 7.22%, PRMW is in the better half of the industry, outperforming 60.61% of the companies in the same industry.
  • PRMW's Return On Equity of 17.34% is fine compared to the rest of the industry. PRMW outperforms 63.64% of its industry peers.
  • PRMW's Return On Invested Capital of 4.13% is on the low side compared to the rest of the industry. PRMW is outperformed by 72.73% of its industry peers.
  • PRMW had an Average Return On Invested Capital over the past 3 years of 3.20%. This is significantly below the industry average of 11.84%.
  • The last Return On Invested Capital (4.13%) for PRMW is above the 3 year average (3.20%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 7.22%
ROE 17.34%
ROIC 4.13%
ROA(3y)2.49%
ROA(5y)0.78%
ROE(3y)6.19%
ROE(5y)1.81%
ROIC(3y)3.2%
ROIC(5y)3.02%
PRMW Yearly ROA, ROE, ROICPRMW Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 0 10 20 30

1.3 Margins

  • With an excellent Profit Margin value of 17.64%, PRMW belongs to the best of the industry, outperforming 81.82% of the companies in the same industry.
  • PRMW's Profit Margin has declined in the last couple of years.
  • PRMW has a worse Operating Margin (12.23%) than 63.64% of its industry peers.
  • PRMW's Operating Margin has improved in the last couple of years.
  • PRMW has a better Gross Margin (68.16%) than 100.00% of its industry peers.
  • In the last couple of years the Gross Margin of PRMW has grown nicely.
Industry RankSector Rank
OM 12.23%
PM (TTM) 17.64%
GM 68.16%
OM growth 3Y10.6%
OM growth 5Y18.86%
PM growth 3YN/A
PM growth 5Y-8.87%
GM growth 3Y4.02%
GM growth 5Y2.34%
PRMW Yearly Profit, Operating, Gross MarginsPRMW Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 0 20 40 60

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6

2. PRMW Health Analysis

2.1 Basic Checks

  • With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), PRMW is destroying value.
  • Compared to 1 year ago, PRMW has about the same amount of shares outstanding.
  • The debt/assets ratio for PRMW has been reduced compared to a year ago.
PRMW Yearly Shares OutstandingPRMW Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 50M 100M 150M
PRMW Yearly Total Debt VS Total AssetsPRMW Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 1B 2B 3B 4B

2.2 Solvency

  • PRMW has an Altman-Z score of 1.96. This is not the best score and indicates that PRMW is in the grey zone with still only limited risk for bankruptcy at the moment.
  • The Altman-Z score of PRMW (1.96) is comparable to the rest of the industry.
  • PRMW has a debt to FCF ratio of 5.49. This is a neutral value as PRMW would need 5.49 years to pay back of all of its debts.
  • PRMW has a Debt to FCF ratio of 5.49. This is in the better half of the industry: PRMW outperforms 69.70% of its industry peers.
  • PRMW has a Debt/Equity ratio of 0.86. This is a neutral value indicating PRMW is somewhat dependend on debt financing.
  • The Debt to Equity ratio of PRMW (0.86) is comparable to the rest of the industry.
Industry RankSector Rank
Debt/Equity 0.86
Debt/FCF 5.49
Altman-Z 1.96
ROIC/WACC0.54
WACC7.61%
PRMW Yearly LT Debt VS Equity VS FCFPRMW Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 500M 1B 1.5B 2B

2.3 Liquidity

  • PRMW has a Current Ratio of 2.34. This indicates that PRMW is financially healthy and has no problem in meeting its short term obligations.
  • Looking at the Current ratio, with a value of 2.34, PRMW is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
  • A Quick Ratio of 2.23 indicates that PRMW has no problem at all paying its short term obligations.
  • The Quick ratio of PRMW (2.23) is better than 90.91% of its industry peers.
Industry RankSector Rank
Current Ratio 2.34
Quick Ratio 2.23
PRMW Yearly Current Assets VS Current LiabilitesPRMW Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

3

3. PRMW Growth Analysis

3.1 Past

  • The Earnings Per Share has grown by an nice 12.20% over the past year.
  • PRMW shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 22.74% yearly.
  • PRMW shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -36.45%.
  • The Revenue has been decreasing by -0.22% on average over the past years.
EPS 1Y (TTM)12.2%
EPS 3Y15.98%
EPS 5Y22.74%
EPS Q2Q%6.06%
Revenue 1Y (TTM)-36.45%
Revenue growth 3Y-3.2%
Revenue growth 5Y-0.22%
Sales Q2Q%-17.78%

3.2 Future

  • Based on estimates for the next years, PRMW will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.95% on average per year.
  • PRMW is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.75% yearly.
EPS Next Y27.83%
EPS Next 2Y21.02%
EPS Next 3Y22.04%
EPS Next 5Y10.95%
Revenue Next Year-18.79%
Revenue Next 2Y-7.32%
Revenue Next 3Y-2.88%
Revenue Next 5Y-0.75%

3.3 Evolution

  • The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
  • 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.
PRMW Yearly Revenue VS EstimatesPRMW Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 1B 2B 3B
PRMW Yearly EPS VS EstimatesPRMW Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 0 0.5 1

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5

4. PRMW Valuation Analysis

4.1 Price/Earnings Ratio

  • PRMW is valuated quite expensively with a Price/Earnings ratio of 26.32.
  • The rest of the industry has a similar Price/Earnings ratio as PRMW.
  • PRMW's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 25.70.
  • With a Price/Forward Earnings ratio of 21.19, PRMW is valued on the expensive side.
  • PRMW's Price/Forward Earnings ratio is in line with the industry average.
  • PRMW is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 23.84, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 26.32
Fwd PE 21.19
PRMW Price Earnings VS Forward Price EarningsPRMW Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

  • PRMW's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. PRMW is cheaper than 60.61% of the companies in the same industry.
  • Compared to the rest of the industry, the Price/Free Cash Flow ratio of PRMW indicates a rather cheap valuation: PRMW is cheaper than 84.85% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 16.59
EV/EBITDA 13.63
PRMW Per share dataPRMW EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 2 4 6 8

4.3 Compensation for Growth

  • PRMW's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
  • PRMW has a very decent profitability rating, which may justify a higher PE ratio.
  • PRMW's earnings are expected to grow with 22.04% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.95
PEG (5Y)1.16
EPS Next 2Y21.02%
EPS Next 3Y22.04%

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6

5. PRMW Dividend Analysis

5.1 Amount

  • PRMW has a Yearly Dividend Yield of 1.34%. Purely for dividend investing, there may be better candidates out there.
  • Compared to an average industry Dividend Yield of 1.70, PRMW has a dividend in line with its industry peers.
  • PRMW's Dividend Yield is slightly below the S&P500 average, which is at 1.82.
Industry RankSector Rank
Dividend Yield 1.34%

5.2 History

  • The dividend of PRMW has a limited annual growth rate of 1.16%.
  • PRMW has been paying a dividend for at least 10 years, so it has a reliable track record.
  • PRMW has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)1.16%
Div Incr Years2
Div Non Decr Years11
PRMW Yearly Dividends per sharePRMW Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 0.2 0.4 0.6 0.8 1

5.3 Sustainability

  • 22.12% of the earnings are spent on dividend by PRMW. This is a low number and sustainable payout ratio.
  • PRMW's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP22.12%
EPS Next 2Y21.02%
EPS Next 3Y22.04%
PRMW Yearly Income VS Free CF VS DividendPRMW Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 0 100M -100M 200M 300M
PRMW Dividend Payout.PRMW Dividend Payout, showing the Payout Ratio.PRMW Dividend Payout.PayoutRetained Earnings

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PRMW Fundamentals: All Metrics, Ratios and Statistics

Primo Water Corporation

NYSE:PRMW (11/8/2024, 8:15:10 PM)

After market: 24.26 +0.05 (+0.21%)

24.21

-0.23 (-0.94%)

Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)11-07
Earnings (Next)N/A
Inst Owners89.04%
Inst Owner Change0%
Ins Owners2.23%
Ins Owner Change0%
Market Cap3.88B
Revenue(TTM)1.46B
Net Income(TTM)257.20M
Analysts82.86
Price Target17.35 (-28.34%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 1.34%
Yearly Dividend0.32
Dividend Growth(5Y)1.16%
DP22.12%
Div Incr Years2
Div Non Decr Years11
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.7%
Min EPS beat(2)1.96%
Max EPS beat(2)13.43%
EPS beat(4)3
Avg EPS beat(4)3.94%
Min EPS beat(4)-29.61%
Max EPS beat(4)29.96%
EPS beat(8)6
Avg EPS beat(8)7.5%
EPS beat(12)8
Avg EPS beat(12)8.05%
EPS beat(16)11
Avg EPS beat(16)10.17%
Revenue beat(2)1
Avg Revenue beat(2)0.77%
Min Revenue beat(2)-0.57%
Max Revenue beat(2)2.11%
Revenue beat(4)2
Avg Revenue beat(4)-5.76%
Min Revenue beat(4)-25.44%
Max Revenue beat(4)2.11%
Revenue beat(8)3
Avg Revenue beat(8)-3.87%
Revenue beat(12)4
Avg Revenue beat(12)-3.03%
Revenue beat(16)6
Avg Revenue beat(16)-2.3%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0%
EPS NY rev (3m)2.68%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.21%
Valuation
Industry RankSector Rank
PE 26.32
Fwd PE 21.19
P/S 2.66
P/FCF 16.59
P/OCF 10.98
P/B 2.62
P/tB N/A
EV/EBITDA 13.63
EPS(TTM)0.92
EY3.8%
EPS(NY)1.14
Fwd EY4.72%
FCF(TTM)1.46
FCFY6.03%
OCF(TTM)2.2
OCFY9.11%
SpS9.09
BVpS9.25
TBVpS-1.47
PEG (NY)0.95
PEG (5Y)1.16
Graham NumberN/A
Profitability
Industry RankSector Rank
ROA 7.22%
ROE 17.34%
ROCE 5.69%
ROIC 4.13%
ROICexc 5.25%
ROICexgc 17.26%
OM 12.23%
PM (TTM) 17.64%
GM 68.16%
FCFM 16.05%
ROA(3y)2.49%
ROA(5y)0.78%
ROE(3y)6.19%
ROE(5y)1.81%
ROIC(3y)3.2%
ROIC(5y)3.02%
ROICexc(3y)3.53%
ROICexc(5y)3.28%
ROICexgc(3y)11.83%
ROICexgc(5y)11.37%
ROCE(3y)4.6%
ROCE(5y)4.33%
ROICexgc growth 3Y3.08%
ROICexgc growth 5Y11.87%
ROICexc growth 3Y13.05%
ROICexc growth 5Y18.08%
OM growth 3Y10.6%
OM growth 5Y18.86%
PM growth 3YN/A
PM growth 5Y-8.87%
GM growth 3Y4.02%
GM growth 5Y2.34%
F-Score7
Asset Turnover0.41
Health
Industry RankSector Rank
Debt/Equity 0.86
Debt/FCF 5.49
Debt/EBITDA 3.84
Cap/Depr 78.79%
Cap/Sales 8.2%
Interest Coverage 3.21
Cash Conversion 107.09%
Profit Quality 90.98%
Current Ratio 2.34
Quick Ratio 2.23
Altman-Z 1.96
F-Score7
WACC7.61%
ROIC/WACC0.54
Cap/Depr(3y)80.99%
Cap/Depr(5y)73.85%
Cap/Sales(3y)8.7%
Cap/Sales(5y)7.71%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)12.2%
EPS 3Y15.98%
EPS 5Y22.74%
EPS Q2Q%6.06%
EPS Next Y27.83%
EPS Next 2Y21.02%
EPS Next 3Y22.04%
EPS Next 5Y10.95%
Revenue 1Y (TTM)-36.45%
Revenue growth 3Y-3.2%
Revenue growth 5Y-0.22%
Sales Q2Q%-17.78%
Revenue Next Year-18.79%
Revenue Next 2Y-7.32%
Revenue Next 3Y-2.88%
Revenue Next 5Y-0.75%
EBIT growth 1Y1.94%
EBIT growth 3Y7.06%
EBIT growth 5Y18.6%
EBIT Next Year86.15%
EBIT Next 3Y30.95%
EBIT Next 5Y15.23%
FCF growth 1Y367.07%
FCF growth 3Y56.46%
FCF growth 5Y60.54%
OCF growth 1Y31.01%
OCF growth 3Y25.74%
OCF growth 5Y19.02%

Primo Water Corporation / PRMW Fundamental Analysis FAQ

What is the fundamental rating for PRMW stock?

ChartMill assigns a fundamental rating of 5 / 10 to PRMW.


What is the valuation status for PRMW stock?

ChartMill assigns a valuation rating of 5 / 10 to Primo Water Corporation (PRMW). This can be considered as Fairly Valued.


What is the profitability of PRMW stock?

Primo Water Corporation (PRMW) has a profitability rating of 6 / 10.


What is the valuation of Primo Water Corporation based on its PE and PB ratios?

The Price/Earnings (PE) ratio for Primo Water Corporation (PRMW) is 26.32 and the Price/Book (PB) ratio is 2.62.


What is the expected EPS growth for Primo Water Corporation (PRMW) stock?

The Earnings per Share (EPS) of Primo Water Corporation (PRMW) is expected to grow by 27.83% in the next year.