Hormel Foods Corp. (HRL) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

McCormick & Co., Inc.

Mama's Creations, Inc.

Tyson Foods, Inc.

Mondelez International, Inc.

Hormel Foods Corp.

Lifeway Foods, Inc.

Kellanova

Conagra Brands, Inc.

Blue Star Foods Corp.

Bit Origin Ltd.

Why is Hormel Foods Corp. ?

OPERATING CASH FLOW(Y) Lowest at USD 930.97 MM
ROCE(HY) Lowest at 9.46%
RAW MATERIAL COST(Y) Grown by 6.11% (YoY)

With ROCE of 9.54%, it has a very expensive valuation with a 1.87 Enterprise value to Capital Employed

The stock is trading at a discount compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of -28.43%, its profits have fallen by -5.6%

Consistent Underperformance against the benchmark over the last 3 years

Along with generating -28.43% returns in the last 1 year, the stock has also underperformed S&P 500 in each of the last 3 annual periods

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Hormel Foods Corp. should be less than 10%
Overall Portfolio exposure to FMCG should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in FMCG)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Hormel Foods Corp. for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Hormel Foods Corp.

-15.95%

-0.87

25.74%

S&P 500

20.78%

0.70

20.15%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

4.63%

EBIT Growth (5y)

-3.57%

EBIT to Interest (avg)

20.05

Debt to EBITDA (avg)

1.41

Net Debt to Equity (avg)

0.27

Sales to Capital Employed (avg)

1.10

Tax Ratio

21.73%

Dividend Payout Ratio

133.53%

Pledged Shares

Institutional Holding

57.90%

ROCE (avg)

12.09%

ROE (avg)

11.74%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

1.60

EV to EBIT

16.13

EV to EBITDA

12.49

EV to Capital Employed

1.48

EV to Sales

1.21

PEG Ratio

Dividend Yield

5.03%

ROCE (Latest)

9.18%

ROE (Latest)

7.00%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Dow Theory

Mildly Bearish

OBV

Mildly Bearish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

8What is working for the Company

DIVIDEND PAYOUT RATIO(Y)

Highest at 102.27%

INTEREST COVERAGE RATIO(Q)

Highest at 1,684.25

RAW MATERIAL COST(Y)

Fallen by -2.98% (YoY

DEBT-EQUITY RATIO (HY)

Lowest at 25.12 %

OPERATING PROFIT(Q)

Highest at USD 338.01 MM

OPERATING PROFIT MARGIN(Q)

Highest at 11.37 %

-6What is not working for the Company

NET PROFIT(9M)

At USD 360.81 MM has Grown at -37.33%

ROCE(HY)

Lowest at 5.84%

Here's what is working for Hormel Foods Corp.

Interest Coverage Ratio

Highest at 1,684.25

in the last five periods

MOJO Watch

The company's ability to manage interest payments is improving

Operating Profit to Interest

Dividend Payout Ratio

Highest at 102.27% and Grown

In each year in the last five years

MOJO Watch

Company is distributing higher proportion of profits generated as dividend

DPR (%)

Operating Profit

Highest at USD 338.01 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is positive

Operating Profit (USD MM)

Operating Profit Margin

Highest at 11.37 %

in the last five periods

MOJO Watch

Company's profit margin has improved

Operating Profit to Sales

Debt-Equity Ratio

Lowest at 25.12 %

in the last five Semi-Annual periods

MOJO Watch

The company has been reducing its borrowing as compared to equity capital

Debt-Equity Ratio

Raw Material Cost

Fallen by -2.98% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales

Here's what is not working for Hormel Foods Corp.

Net Profit

At USD 360.81 MM has Grown at -37.33%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is very negative

Net Profit (USD MM)