CONAGRA BRANDS INC (CAG) Stock Fundamental Analysis
NYSE:CAG - New York Stock Exchange, Inc. - US2058871029 - Common Stock - Currency: USD
Overall CAG gets a fundamental rating of 5 out of 10. We evaluated CAG against 89 industry peers in the Food Products industry. While CAG is still in line with the averages on profitability rating, there are concerns on its financial health. CAG has a bad growth rate and is valued cheaply. Finally CAG also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
CAG had positive earnings in the past year.
CAG had a positive operating cash flow in the past year.
CAG had positive earnings in each of the past 5 years.
Each year in the past 5 years CAG had a positive operating cash flow.
1.2 Ratios
CAG has a Return On Assets of 1.59%. This is comparable to the rest of the industry: CAG outperforms 43.82% of its industry peers.
The Return On Equity of CAG (3.75%) is comparable to the rest of the industry.
CAG's Return On Invested Capital of 7.97% is fine compared to the rest of the industry. CAG outperforms 73.03% of its industry peers.
CAG had an Average Return On Invested Capital over the past 3 years of 7.89%. This is in line with the industry average of 9.00%.
The 3 year average ROIC (7.89%) for CAG is below the current ROIC(7.97%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.59% | ||
| ROE | 3.75% | ||
| ROIC | 7.97% |
ROA(3y)2.91%
ROA(5y)3.67%
ROE(3y)7.35%
ROE(5y)9.58%
ROIC(3y)7.89%
ROIC(5y)7.89%
1.3 Margins
With a Profit Margin value of 2.80%, CAG perfoms like the industry average, outperforming 52.81% of the companies in the same industry.
In the last couple of years the Profit Margin of CAG has declined.
With an excellent Operating Margin value of 14.89%, CAG belongs to the best of the industry, outperforming 85.39% of the companies in the same industry.
CAG's Operating Margin has been stable in the last couple of years.
The Gross Margin of CAG (26.61%) is better than 64.04% of its industry peers.
In the last couple of years the Gross Margin of CAG has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.89% | ||
| PM (TTM) | 2.8% | ||
| GM | 26.61% |
OM growth 3Y-3.57%
OM growth 5Y1.45%
PM growth 3Y-37.17%
PM growth 5Y-16.52%
GM growth 3Y-1.09%
GM growth 5Y-0.05%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), CAG is creating some value.
CAG has more shares outstanding than it did 1 year ago.
The number of shares outstanding for CAG has been reduced compared to 5 years ago.
CAG has a better debt/assets ratio than last year.
2.2 Solvency
CAG has an Altman-Z score of 1.81. This is a bad value and indicates that CAG is not financially healthy and even has some risk of bankruptcy.
CAG has a Altman-Z score (1.81) which is in line with its industry peers.
The Debt to FCF ratio of CAG is 5.62, which is a neutral value as it means it would take CAG, 5.62 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 5.62, CAG is in the better half of the industry, outperforming 68.54% of the companies in the same industry.
A Debt/Equity ratio of 0.81 indicates that CAG is somewhat dependend on debt financing.
The Debt to Equity ratio of CAG (0.81) is worse than 66.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | 5.62 | ||
| Altman-Z | 1.81 |
ROIC/WACC1.19
WACC6.72%
2.3 Liquidity
A Current Ratio of 0.69 indicates that CAG may have some problems paying its short term obligations.
CAG's Current ratio of 0.69 is on the low side compared to the rest of the industry. CAG is outperformed by 80.90% of its industry peers.
CAG has a Quick Ratio of 0.69. This is a bad value and indicates that CAG is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.23, CAG is doing worse than 92.13% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.69 | ||
| Quick Ratio | 0.23 |
3. Growth
3.1 Past
The earnings per share for CAG have decreased strongly by -12.31% in the last year.
CAG shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.84% yearly.
The Revenue has decreased by -3.15% in the past year.
CAG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.79% yearly.
EPS 1Y (TTM)-12.31%
EPS 3Y0.38%
EPS 5Y5.84%
EPS Q2Q%-26.09%
Revenue 1Y (TTM)-3.15%
Revenue growth 3Y2.52%
Revenue growth 5Y4.79%
Sales Q2Q%-6.33%
3.2 Future
The Earnings Per Share is expected to grow by 1.56% on average over the next years.
Based on estimates for the next years, CAG will show a small growth in Revenue. The Revenue will grow by 0.37% on average per year.
EPS Next Y-11.61%
EPS Next 2Y-3.9%
EPS Next 3Y-1.28%
EPS Next 5Y1.56%
Revenue Next Year-3.1%
Revenue Next 2Y-0.59%
Revenue Next 3Y-0.45%
Revenue Next 5Y0.37%
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 decreasing.
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.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 10.29, the valuation of CAG can be described as very reasonable.
80.90% of the companies in the same industry are more expensive than CAG, based on the Price/Earnings ratio.
CAG is valuated cheaply when we compare the Price/Earnings ratio to 27.85, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 9.81 indicates a reasonable valuation of CAG.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CAG indicates a rather cheap valuation: CAG is cheaper than 94.38% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of CAG to the average of the S&P500 Index (20.77), we can say CAG is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.29 | ||
| Fwd PE | 9.81 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CAG indicates a somewhat cheap valuation: CAG is cheaper than 67.42% of the companies listed in the same industry.
84.27% of the companies in the same industry are more expensive than CAG, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.97 | ||
| EV/EBITDA | 8.83 |
4.3 Compensation for Growth
CAG has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.76
EPS Next 2Y-3.9%
EPS Next 3Y-1.28%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.62%, CAG is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 4.32, CAG pays a better dividend. On top of this CAG pays more dividend than 89.89% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.45, CAG pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.62% |
5.2 History
On average, the dividend of CAG grows each year by 11.19%, which is quite nice.
CAG has been paying a dividend for at least 10 years, so it has a reliable track record.
CAG has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)11.19%
Div Incr Years5
Div Non Decr Years17
5.3 Sustainability
CAG pays out 203.43% of its income as dividend. This is not a sustainable payout ratio.
The dividend of CAG is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP203.43%
EPS Next 2Y-3.9%
EPS Next 3Y-1.28%
24.18
-0.53 (-2.14%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners89.44%
Inst Owner Change1.3%
Ins Owners0.51%
Ins Owner Change0.02%
Market Cap11.54B
Analysts65.22
Price Target27.82 (15.05%)
Short Float %2.99%
Short Ratio2.2
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.62% |
Yearly Dividend1.38
Dividend Growth(5Y)11.19%
DP203.43%
Div Incr Years5
Div Non Decr Years17
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.78%
Min EPS beat(2)-4.3%
Max EPS beat(2)2.74%
EPS beat(4)2
Avg EPS beat(4)-1.98%
Min EPS beat(4)-11.84%
Max EPS beat(4)5.47%
EPS beat(8)6
Avg EPS beat(8)1.62%
EPS beat(12)10
Avg EPS beat(12)5.1%
EPS beat(16)12
Avg EPS beat(16)3.71%
Revenue beat(2)1
Avg Revenue beat(2)-1.33%
Min Revenue beat(2)-3.1%
Max Revenue beat(2)0.44%
Revenue beat(4)1
Avg Revenue beat(4)-1.81%
Min Revenue beat(4)-3.1%
Max Revenue beat(4)0.44%
Revenue beat(8)1
Avg Revenue beat(8)-1.74%
Revenue beat(12)2
Avg Revenue beat(12)-1.3%
Revenue beat(16)5
Avg Revenue beat(16)-0.63%
PT rev (1m)-0.84%
PT rev (3m)-9.07%
EPS NQ rev (1m)0.77%
EPS NQ rev (3m)-8.26%
EPS NY rev (1m)-1.32%
EPS NY rev (3m)-9.5%
Revenue NQ rev (1m)0.28%
Revenue NQ rev (3m)-2%
Revenue NY rev (1m)-0.68%
Revenue NY rev (3m)-1.49%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.29 | ||
| Fwd PE | 9.81 | ||
| P/S | 0.98 | ||
| P/FCF | 7.97 | ||
| P/OCF | 6.3 | ||
| P/B | 1.31 | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.83 |
EPS(TTM)2.35
EY9.72%
EPS(NY)2.47
Fwd EY10.2%
FCF(TTM)3.03
FCFY12.55%
OCF(TTM)3.84
OCFY15.87%
SpS24.59
BVpS18.39
TBVpS-8.81
PEG (NY)N/A
PEG (5Y)1.76
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.59% | ||
| ROE | 3.75% | ||
| ROCE | 10.63% | ||
| ROIC | 7.97% | ||
| ROICexc | 8% | ||
| ROICexgc | 32.25% | ||
| OM | 14.89% | ||
| PM (TTM) | 2.8% | ||
| GM | 26.61% | ||
| FCFM | 12.34% |
ROA(3y)2.91%
ROA(5y)3.67%
ROE(3y)7.35%
ROE(5y)9.58%
ROIC(3y)7.89%
ROIC(5y)7.89%
ROICexc(3y)7.92%
ROICexc(5y)7.96%
ROICexgc(3y)35.02%
ROICexgc(5y)39.72%
ROCE(3y)10.33%
ROCE(5y)10.27%
ROICexcg growth 3Y-9.41%
ROICexcg growth 5Y-0.75%
ROICexc growth 3Y0.69%
ROICexc growth 5Y7.83%
OM growth 3Y-3.57%
OM growth 5Y1.45%
PM growth 3Y-37.17%
PM growth 5Y-16.52%
GM growth 3Y-1.09%
GM growth 5Y-0.05%
F-Score6
Asset Turnover0.57
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | 5.62 | ||
| Debt/EBITDA | 3.31 | ||
| Cap/Depr | 94.7% | ||
| Cap/Sales | 3.26% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 85.09% | ||
| Profit Quality | 440.17% | ||
| Current Ratio | 0.69 | ||
| Quick Ratio | 0.23 | ||
| Altman-Z | 1.81 |
F-Score6
WACC6.72%
ROIC/WACC1.19
Cap/Depr(3y)106.15%
Cap/Depr(5y)108.81%
Cap/Sales(3y)3.4%
Cap/Sales(5y)3.61%
Profit Quality(3y)213.8%
Profit Quality(5y)178.16%
High Growth Momentum
Growth
EPS 1Y (TTM)-12.31%
EPS 3Y0.38%
EPS 5Y5.84%
EPS Q2Q%-26.09%
EPS Next Y-11.61%
EPS Next 2Y-3.9%
EPS Next 3Y-1.28%
EPS Next 5Y1.56%
Revenue 1Y (TTM)-3.15%
Revenue growth 3Y2.52%
Revenue growth 5Y4.79%
Sales Q2Q%-6.33%
Revenue Next Year-3.1%
Revenue Next 2Y-0.59%
Revenue Next 3Y-0.45%
Revenue Next 5Y0.37%
EBIT growth 1Y-9.64%
EBIT growth 3Y-1.14%
EBIT growth 5Y6.31%
EBIT Next Year13.36%
EBIT Next 3Y5.31%
EBIT Next 5Y5.44%
FCF growth 1Y90.48%
FCF growth 3Y19.15%
FCF growth 5Y16.06%
OCF growth 1Y62.33%
OCF growth 3Y11.13%
OCF growth 5Y12.35%