BROWN-FORMAN CORP-CLASS A (BF.A) Stock Fundamental Analysis
NYSE:BF.A - New York Stock Exchange, Inc. - US1156371007 - Common Stock - Currency: USD
Taking everything into account, BF.A scores 6 out of 10 in our fundamental rating. BF.A was compared to 33 industry peers in the Beverages industry. BF.A gets an excellent profitability rating and is at the same time showing great financial health properties. BF.A is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year BF.A was profitable.
BF.A had a positive operating cash flow in the past year.
In the past 5 years BF.A has always been profitable.
Of the past 5 years BF.A 4 years had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 12.25%, BF.A belongs to the top of the industry, outperforming 87.88% of the companies in the same industry.
With an excellent Return On Equity value of 25.87%, BF.A belongs to the best of the industry, outperforming 81.82% of the companies in the same industry.
BF.A has a better Return On Invested Capital (13.00%) than 72.73% of its industry peers.
BF.A had an Average Return On Invested Capital over the past 3 years of 13.27%. This is in line with the industry average of 11.37%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.25% | ||
| ROE | 25.87% | ||
| ROIC | 13% |
ROA(3y)11.12%
ROA(5y)12.07%
ROE(3y)24.95%
ROE(5y)27.89%
ROIC(3y)13.27%
ROIC(5y)14.41%
1.3 Margins
With an excellent Profit Margin value of 24.45%, BF.A belongs to the best of the industry, outperforming 96.97% of the companies in the same industry.
In the last couple of years the Profit Margin of BF.A has declined.
With an excellent Operating Margin value of 28.43%, BF.A belongs to the best of the industry, outperforming 90.91% of the companies in the same industry.
BF.A's Operating Margin has declined in the last couple of years.
With an excellent Gross Margin value of 59.31%, BF.A belongs to the best of the industry, outperforming 84.85% of the companies in the same industry.
In the last couple of years the Gross Margin of BF.A has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.43% | ||
| PM (TTM) | 24.45% | ||
| GM | 59.31% |
OM growth 3Y-1.38%
OM growth 5Y-2.46%
PM growth 3Y0.86%
PM growth 5Y-2.33%
GM growth 3Y-1.02%
GM growth 5Y-1.4%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), BF.A is creating some value.
BF.A has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, BF.A has less shares outstanding
The debt/assets ratio for BF.A has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.00 indicates that BF.A is not in any danger for bankruptcy at the moment.
BF.A has a Altman-Z score of 4.00. This is in the better half of the industry: BF.A outperforms 72.73% of its industry peers.
The Debt to FCF ratio of BF.A is 5.36, which is a neutral value as it means it would take BF.A, 5.36 years of fcf income to pay off all of its debts.
BF.A has a Debt to FCF ratio of 5.36. This is in the better half of the industry: BF.A outperforms 69.70% of its industry peers.
A Debt/Equity ratio of 0.67 indicates that BF.A is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.67, BF.A perfoms like the industry average, outperforming 48.48% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 5.36 | ||
| Altman-Z | 4 |
ROIC/WACC1.34
WACC9.68%
2.3 Liquidity
A Current Ratio of 3.49 indicates that BF.A has no problem at all paying its short term obligations.
The Current ratio of BF.A (3.49) is better than 87.88% of its industry peers.
A Quick Ratio of 1.49 indicates that BF.A should not have too much problems paying its short term obligations.
BF.A has a Quick ratio of 1.49. This is in the better half of the industry: BF.A outperforms 75.76% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.49 | ||
| Quick Ratio | 1.49 |
3. Growth
3.1 Past
The earnings per share for BF.A have decreased strongly by -20.56% in the last year.
Measured over the past years, BF.A shows a decrease in Earnings Per Share. The EPS has been decreasing by -0.35% on average per year.
The Revenue has decreased by -4.86% in the past year.
Measured over the past years, BF.A shows a small growth in Revenue. The Revenue has been growing by 3.40% on average per year.
EPS 1Y (TTM)-20.56%
EPS 3Y-0.77%
EPS 5Y-0.35%
EPS Q2Q%-44.64%
Revenue 1Y (TTM)-4.86%
Revenue growth 3Y0.35%
Revenue growth 5Y3.4%
Sales Q2Q%-7.26%
3.2 Future
The Earnings Per Share is expected to grow by 10.13% on average over the next years. This is quite good.
BF.A is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.82% yearly.
EPS Next Y11.88%
EPS Next 2Y10.13%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year1.69%
Revenue Next 2Y2.82%
Revenue Next 3YN/A
Revenue Next 5YN/A
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 15.46 indicates a correct valuation of BF.A.
Compared to the rest of the industry, the Price/Earnings ratio of BF.A indicates a somewhat cheap valuation: BF.A is cheaper than 69.70% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of BF.A to the average of the S&P500 Index (26.57), we can say BF.A is valued slightly cheaper.
With a Price/Forward Earnings ratio of 13.82, BF.A is valued correctly.
BF.A's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. BF.A is cheaper than 78.79% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.41, BF.A is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.46 | ||
| Fwd PE | 13.82 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, BF.A is valued a bit cheaper than the industry average as 66.67% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, BF.A is valued a bit cheaper than the industry average as 66.67% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.26 | ||
| EV/EBITDA | 11.78 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of BF.A may justify a higher PE ratio.
PEG (NY)1.3
PEG (5Y)N/A
EPS Next 2Y10.13%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.32%, BF.A has a reasonable but not impressive dividend return.
In the last 3 months the price of BF.A has falen by -22.84%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
Compared to an average industry Dividend Yield of 3.27, BF.A pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.40, BF.A pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.32% |
5.2 History
The dividend of BF.A has a limited annual growth rate of 5.58%.
BF.A has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of BF.A decreased in the last 3 years.
Dividend Growth(5Y)5.58%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
42.16% of the earnings are spent on dividend by BF.A. This is a bit on the high side, but may be sustainable.
BF.A's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP42.16%
EPS Next 2Y10.13%
EPS Next 3YN/A
26.28
-0.18 (-0.68%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)
Earnings (Next)
Inst Owners65.9%
Inst Owner Change9.09%
Ins Owners0.38%
Ins Owner ChangeN/A
Market Cap12.42B
Analysts56
Price Target40.25 (53.16%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.32% |
Yearly Dividend0.85
Dividend Growth(5Y)5.58%
DP42.16%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.68%
Min EPS beat(2)-8.35%
Max EPS beat(2)9.71%
EPS beat(4)2
Avg EPS beat(4)4.88%
Min EPS beat(4)-12.45%
Max EPS beat(4)30.61%
EPS beat(8)3
Avg EPS beat(8)0.91%
EPS beat(12)5
Avg EPS beat(12)-2.92%
EPS beat(16)6
Avg EPS beat(16)-3.66%
Revenue beat(2)0
Avg Revenue beat(2)-2.83%
Min Revenue beat(2)-5.48%
Max Revenue beat(2)-0.18%
Revenue beat(4)0
Avg Revenue beat(4)-5.06%
Min Revenue beat(4)-8.1%
Max Revenue beat(4)-0.18%
Revenue beat(8)1
Avg Revenue beat(8)-4.03%
Revenue beat(12)4
Avg Revenue beat(12)-0.88%
Revenue beat(16)7
Avg Revenue beat(16)-0.25%
PT rev (1m)-0.25%
PT rev (3m)-10.92%
EPS NQ rev (1m)0.54%
EPS NQ rev (3m)-0.27%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.87%
Revenue NQ rev (1m)0.01%
Revenue NQ rev (3m)0.01%
Revenue NY rev (1m)-0.36%
Revenue NY rev (3m)-2.51%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.46 | ||
| Fwd PE | 13.82 | ||
| P/S | 3.07 | ||
| P/FCF | 23.26 | ||
| P/OCF | 16.99 | ||
| P/B | 3.25 | ||
| P/tB | 8.78 | ||
| EV/EBITDA | 11.78 |
EPS(TTM)1.7
EY6.47%
EPS(NY)1.9
Fwd EY7.24%
FCF(TTM)1.13
FCFY4.3%
OCF(TTM)1.55
OCFY5.88%
SpS8.56
BVpS8.09
TBVpS2.99
PEG (NY)1.3
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.25% | ||
| ROE | 25.87% | ||
| ROCE | 16.8% | ||
| ROIC | 13% | ||
| ROICexc | 14.21% | ||
| ROICexgc | 22.68% | ||
| OM | 28.43% | ||
| PM (TTM) | 24.45% | ||
| GM | 59.31% | ||
| FCFM | 13.2% |
ROA(3y)11.12%
ROA(5y)12.07%
ROE(3y)24.95%
ROE(5y)27.89%
ROIC(3y)13.27%
ROIC(5y)14.41%
ROICexc(3y)14.11%
ROICexc(5y)16.31%
ROICexgc(3y)22.71%
ROICexgc(5y)24.93%
ROCE(3y)17.47%
ROCE(5y)18.7%
ROICexcg growth 3Y-11.63%
ROICexcg growth 5Y-5.59%
ROICexc growth 3Y-14.25%
ROICexc growth 5Y-7.15%
OM growth 3Y-1.38%
OM growth 5Y-2.46%
PM growth 3Y0.86%
PM growth 5Y-2.33%
GM growth 3Y-1.02%
GM growth 5Y-1.4%
F-Score4
Asset Turnover0.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 5.36 | ||
| Debt/EBITDA | 2.07 | ||
| Cap/Depr | 226.44% | ||
| Cap/Sales | 4.87% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 59.09% | ||
| Profit Quality | 53.99% | ||
| Current Ratio | 3.49 | ||
| Quick Ratio | 1.49 | ||
| Altman-Z | 4 |
F-Score4
WACC9.68%
ROIC/WACC1.34
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-20.56%
EPS 3Y-0.77%
EPS 5Y-0.35%
EPS Q2Q%-44.64%
EPS Next Y11.88%
EPS Next 2Y10.13%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-4.86%
Revenue growth 3Y0.35%
Revenue growth 5Y3.4%
Sales Q2Q%-7.26%
Revenue Next Year1.69%
Revenue Next 2Y2.82%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-7.78%
EBIT growth 3Y-1.04%
EBIT growth 5Y0.86%
EBIT Next Year15.38%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y41.64%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y23.48%
OCF growth 3YN/A
OCF growth 5YN/A