CONAGRA BRANDS INC (CAG) Stock Fundamental Analysis
NYSE:CAG - New York Stock Exchange, Inc. - US2058871029 - Common Stock - Currency: USD
Taking everything into account, CAG scores 5 out of 10 in our fundamental rating. CAG was compared to 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 is cheap, but on the other hand it scores bad on growth. Finally CAG also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year CAG was profitable.
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
The Return On Assets of CAG (5.50%) is better than 70.79% of its industry peers.
CAG has a better Return On Equity (12.90%) than 73.03% of its industry peers.
Looking at the Return On Invested Capital, with a value of 7.56%, CAG is in the better half of the industry, outperforming 70.79% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for CAG is significantly below the industry average of 29.14%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.5% | ||
| ROE | 12.9% | ||
| ROIC | 7.56% |
ROA(3y)3.42%
ROA(5y)4.02%
ROE(3y)8.28%
ROE(5y)10.03%
ROIC(3y)7.92%
ROIC(5y)7.78%
1.3 Margins
CAG has a better Profit Margin (9.92%) than 85.39% of its industry peers.
CAG's Profit Margin has improved in the last couple of years.
CAG's Operating Margin of 14.49% is amongst the best of the industry. CAG outperforms 82.02% of its industry peers.
In the last couple of years the Operating Margin of CAG has declined.
The Gross Margin of CAG (25.95%) is better than 60.67% of its industry peers.
CAG's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.49% | ||
| PM (TTM) | 9.92% | ||
| GM | 25.96% |
OM growth 3Y-1.53%
OM growth 5Y-3%
PM growth 3Y8.84%
PM growth 5Y5.48%
GM growth 3Y1.42%
GM growth 5Y-1.64%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so CAG is still creating some value.
The number of shares outstanding for CAG remains at a similar level compared to 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 1.66. 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 (1.66) which is comparable to the rest of the industry.
CAG has a debt to FCF ratio of 6.19. This is a slightly negative value and a sign of low solvency as CAG would need 6.19 years to pay back of all of its debts.
CAG has a better Debt to FCF ratio (6.19) than 76.40% of its industry peers.
CAG has a Debt/Equity ratio of 0.79. This is a neutral value indicating CAG is somewhat dependend on debt financing.
CAG has a worse Debt to Equity ratio (0.79) than 61.80% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.79 | ||
| Debt/FCF | 6.19 | ||
| Altman-Z | 1.66 |
ROIC/WACC1.14
WACC6.62%
2.3 Liquidity
A Current Ratio of 0.71 indicates that CAG may have some problems paying its short term obligations.
CAG's Current ratio of 0.71 is on the low side compared to the rest of the industry. CAG is outperformed by 82.02% of its industry peers.
CAG has a Quick Ratio of 0.71. 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 0.24, CAG is doing worse than 93.26% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.24 |
3. Growth
3.1 Past
The earnings per share for CAG have decreased strongly by -13.86% in the last year.
Measured over the past 5 years, CAG shows a small growth in Earnings Per Share. The EPS has been growing by 0.17% on average per year.
The Revenue has decreased by -3.64% in the past year.
CAG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.99% yearly.
EPS 1Y (TTM)-13.86%
EPS 3Y-0.99%
EPS 5Y0.17%
EPS Q2Q%-8.2%
Revenue 1Y (TTM)-3.64%
Revenue growth 3Y0.22%
Revenue growth 5Y0.99%
Sales Q2Q%-4.27%
3.2 Future
CAG is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 0.72% yearly.
Based on estimates for the next years, CAG will show a small growth in Revenue. The Revenue will grow by 0.35% on average per year.
EPS Next Y-3.76%
EPS Next 2Y0.61%
EPS Next 3Y-2.58%
EPS Next 5Y0.72%
Revenue Next Year-3.28%
Revenue Next 2Y-2.01%
Revenue Next 3Y-0.71%
Revenue Next 5Y0.35%
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.
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
With a Price/Earnings ratio of 8.39, the valuation of CAG can be described as very reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of CAG indicates a rather cheap valuation: CAG is cheaper than 87.64% of the companies listed in the same industry.
CAG is valuated cheaply when we compare the Price/Earnings ratio to 26.76, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 8.72, the valuation of CAG can be described as reasonable.
CAG's Price/Forward Earnings ratio is rather cheap when compared to the industry. CAG is cheaper than 93.26% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of CAG to the average of the S&P500 Index (34.91), we can say CAG is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.39 | ||
| Fwd PE | 8.72 |
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 71.91% of the companies listed in the same industry.
92.13% 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 | 7.07 | ||
| EV/EBITDA | 7.91 |
4.3 Compensation for Growth
CAG has a very decent profitability rating, which may justify a higher PE ratio.
CAG's earnings are expected to decrease with -2.58% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)48
EPS Next 2Y0.61%
EPS Next 3Y-2.58%
5. Dividend
5.1 Amount
CAG has a Yearly Dividend Yield of 7.20%, which is a nice return.
Compared to an average industry Dividend Yield of 4.55, CAG pays a better dividend. On top of this CAG pays more dividend than 95.51% of the companies listed in the same industry.
CAG's Dividend Yield is rather good when compared to the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.2% |
5.2 History
The dividend of CAG is nicely growing with an annual growth rate of 10.50%!
CAG has paid a dividend for at least 10 years, which is a reliable track record.
CAG has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.5%
Div Incr Years5
Div Non Decr Years17
5.3 Sustainability
58.07% of the earnings are spent on dividend by CAG. This is a bit on the high side, but may be sustainable.
CAG's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP58.07%
EPS Next 2Y0.61%
EPS Next 3Y-2.58%
19.3
+0.05 (+0.26%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners88.63%
Inst Owner Change4.1%
Ins Owners0.64%
Ins Owner Change4.62%
Market Cap9.21B
Analysts55.38
Price Target21.74 (12.64%)
Short Float %6.8%
Short Ratio2.97
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.2% |
Yearly Dividend1.4
Dividend Growth(5Y)10.5%
DP58.07%
Div Incr Years5
Div Non Decr Years17
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-4.39%
Min EPS beat(2)-4.48%
Max EPS beat(2)-4.3%
EPS beat(4)1
Avg EPS beat(4)-4.47%
Min EPS beat(4)-11.84%
Max EPS beat(4)2.74%
EPS beat(8)5
Avg EPS beat(8)0.6%
EPS beat(12)9
Avg EPS beat(12)4.57%
EPS beat(16)11
Avg EPS beat(16)3.23%
Revenue beat(2)0
Avg Revenue beat(2)-2.97%
Min Revenue beat(2)-3.1%
Max Revenue beat(2)-2.84%
Revenue beat(4)1
Avg Revenue beat(4)-2.05%
Min Revenue beat(4)-3.1%
Max Revenue beat(4)0.44%
Revenue beat(8)1
Avg Revenue beat(8)-1.89%
Revenue beat(12)2
Avg Revenue beat(12)-1.4%
Revenue beat(16)5
Avg Revenue beat(16)-0.81%
PT rev (1m)-1.36%
PT rev (3m)-21.85%
EPS NQ rev (1m)-26.25%
EPS NQ rev (3m)-35.44%
EPS NY rev (1m)0%
EPS NY rev (3m)-8.22%
Revenue NQ rev (1m)-2.4%
Revenue NQ rev (3m)-6.08%
Revenue NY rev (1m)-2.22%
Revenue NY rev (3m)-4.53%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.39 | ||
| Fwd PE | 8.72 | ||
| P/S | 0.79 | ||
| P/FCF | 7.07 | ||
| P/OCF | 5.44 | ||
| P/B | 1.03 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.91 |
EPS(TTM)2.3
EY11.92%
EPS(NY)2.21
Fwd EY11.47%
FCF(TTM)2.73
FCFY14.15%
OCF(TTM)3.55
OCFY18.38%
SpS24.32
BVpS18.71
TBVpS-8.36
PEG (NY)N/A
PEG (5Y)48
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.5% | ||
| ROE | 12.9% | ||
| ROCE | 10.13% | ||
| ROIC | 7.56% | ||
| ROICexc | 7.59% | ||
| ROICexgc | 29.75% | ||
| OM | 14.49% | ||
| PM (TTM) | 9.92% | ||
| GM | 25.96% | ||
| FCFM | 11.23% |
ROA(3y)3.42%
ROA(5y)4.02%
ROE(3y)8.28%
ROE(5y)10.03%
ROIC(3y)7.92%
ROIC(5y)7.78%
ROICexc(3y)7.95%
ROICexc(5y)7.81%
ROICexgc(3y)32.64%
ROICexgc(5y)34.56%
ROCE(3y)10.57%
ROCE(5y)10.3%
ROICexcg growth 3Y-5.95%
ROICexcg growth 5Y-11.19%
ROICexc growth 3Y1.74%
ROICexc growth 5Y-0.82%
OM growth 3Y-1.53%
OM growth 5Y-3%
PM growth 3Y8.84%
PM growth 5Y5.48%
GM growth 3Y1.42%
GM growth 5Y-1.64%
F-Score6
Asset Turnover0.55
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.79 | ||
| Debt/FCF | 6.19 | ||
| Debt/EBITDA | 3.4 | ||
| Cap/Depr | 99.77% | ||
| Cap/Sales | 3.35% | ||
| Interest Coverage | 3.94 | ||
| Cash Conversion | 81.69% | ||
| Profit Quality | 113.15% | ||
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.24 | ||
| Altman-Z | 1.66 |
F-Score6
WACC6.62%
ROIC/WACC1.14
Cap/Depr(3y)98.17%
Cap/Depr(5y)109.76%
Cap/Sales(3y)3.17%
Cap/Sales(5y)3.62%
Profit Quality(3y)224.76%
Profit Quality(5y)165.72%
High Growth Momentum
Growth
EPS 1Y (TTM)-13.86%
EPS 3Y-0.99%
EPS 5Y0.17%
EPS Q2Q%-8.2%
EPS Next Y-3.76%
EPS Next 2Y0.61%
EPS Next 3Y-2.58%
EPS Next 5Y0.72%
Revenue 1Y (TTM)-3.64%
Revenue growth 3Y0.22%
Revenue growth 5Y0.99%
Sales Q2Q%-4.27%
Revenue Next Year-3.28%
Revenue Next 2Y-2.01%
Revenue Next 3Y-0.71%
Revenue Next 5Y0.35%
EBIT growth 1Y-14.45%
EBIT growth 3Y-1.31%
EBIT growth 5Y-2.04%
EBIT Next Year5.52%
EBIT Next 3Y6.37%
EBIT Next 5Y9.08%
FCF growth 1Y-19.85%
FCF growth 3Y22.29%
FCF growth 5Y-2.41%
OCF growth 1Y-15.97%
OCF growth 3Y12.88%
OCF growth 5Y-1.68%