GENERAL MILLS INC (GIS) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:GIS - US3703341046 - Common Stock
44.56 USD
+0.07 (+0.16%)
44.5 USD
-0.06 (-0.13%)
GIS gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 87 industry peers in the Food Products industry. While GIS belongs to the best of the industry regarding profitability, there are concerns on its financial health. GIS has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- GIS had positive earnings in the past year.
- In the past year GIS had a positive cash flow from operations.
- GIS had positive earnings in each of the past 5 years.
- GIS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- GIS's Return On Assets of 7.79% is amongst the best of the industry. GIS outperforms 89.66% of its industry peers.
- GIS has a better Return On Equity (27.23%) than 96.55% of its industry peers.
- With an excellent Return On Invested Capital value of 9.65%, GIS belongs to the best of the industry, outperforming 87.36% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for GIS is significantly below the industry average of 27.79%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.79% | ||
| ROE | 27.23% | ||
| ROIC | 9.65% |
ROA(3y)7.71%
ROA(5y)7.84%
ROE(3y)25.45%
ROE(5y)25.35%
ROIC(3y)10.86%
ROIC(5y)11.02%
1.3 Margins
- With an excellent Profit Margin value of 13.51%, GIS belongs to the best of the industry, outperforming 96.55% of the companies in the same industry.
- GIS's Profit Margin has been stable in the last couple of years.
- The Operating Margin of GIS (15.95%) is better than 93.10% of its industry peers.
- GIS's Operating Margin has been stable in the last couple of years.
- GIS has a Gross Margin of 33.83%. This is in the better half of the industry: GIS outperforms 74.71% of its industry peers.
- GIS's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.95% | ||
| PM (TTM) | 13.51% | ||
| GM | 33.83% |
OM growth 3Y-0.79%
OM growth 5Y0.02%
PM growth 3Y-6.16%
PM growth 5Y-0.98%
GM growth 3Y0.86%
GM growth 5Y-0.37%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), GIS is creating some value.
- Compared to 1 year ago, GIS has less shares outstanding
- GIS has less shares outstanding than it did 5 years ago.
- The debt/assets ratio for GIS is higher compared to a year ago.
2.2 Solvency
- GIS has an Altman-Z score of 2.37. This is not the best score and indicates that GIS is in the grey zone with still only limited risk for bankruptcy at the moment.
- GIS's Altman-Z score of 2.37 is in line compared to the rest of the industry. GIS outperforms 55.17% of its industry peers.
- The Debt to FCF ratio of GIS is 7.70, which is on the high side as it means it would take GIS, 7.70 years of fcf income to pay off all of its debts.
- GIS's Debt to FCF ratio of 7.70 is fine compared to the rest of the industry. GIS outperforms 65.52% of its industry peers.
- A Debt/Equity ratio of 1.31 is on the high side and indicates that GIS has dependencies on debt financing.
- The Debt to Equity ratio of GIS (1.31) is worse than 79.31% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.31 | ||
| Debt/FCF | 7.7 | ||
| Altman-Z | 2.37 |
ROIC/WACC1.46
WACC6.62%
2.3 Liquidity
- GIS has a Current Ratio of 0.66. This is a bad value and indicates that GIS is not financially healthy enough and could expect problems in meeting its short term obligations.
- The Current ratio of GIS (0.66) is worse than 87.36% of its industry peers.
- GIS has a Quick Ratio of 0.66. This is a bad value and indicates that GIS is not financially healthy enough and could expect problems in meeting its short term obligations.
- GIS has a worse Quick ratio (0.39) than 81.61% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.66 | ||
| Quick Ratio | 0.39 |
3. Growth
3.1 Past
- The earnings per share for GIS have decreased strongly by -20.43% in the last year.
- GIS shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 3.12% yearly.
- GIS shows a decrease in Revenue. In the last year, the revenue decreased by -5.65%.
- Measured over the past years, GIS shows a small growth in Revenue. The Revenue has been growing by 2.03% on average per year.
EPS 1Y (TTM)-20.43%
EPS 3Y2.23%
EPS 5Y3.12%
EPS Q2Q%-21.43%
Revenue 1Y (TTM)-5.65%
Revenue growth 3Y0.86%
Revenue growth 5Y2.03%
Sales Q2Q%-7.24%
3.2 Future
- Based on estimates for the next years, GIS will show a small growth in Earnings Per Share. The EPS will grow by 0.16% on average per year.
- The Revenue is expected to decrease by -0.06% on average over the next years.
EPS Next Y-12.33%
EPS Next 2Y-5.16%
EPS Next 3Y-1.49%
EPS Next 5Y0.16%
Revenue Next Year-4.51%
Revenue Next 2Y-2.63%
Revenue Next 3Y-1.13%
Revenue Next 5Y-0.06%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last 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.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 12.04 indicates a correct valuation of GIS.
- Based on the Price/Earnings ratio, GIS is valued a bit cheaper than 79.31% of the companies in the same industry.
- The average S&P500 Price/Earnings ratio is at 27.21. GIS is valued rather cheaply when compared to this.
- The Price/Forward Earnings ratio is 11.77, which indicates a very decent valuation of GIS.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of GIS indicates a rather cheap valuation: GIS is cheaper than 81.61% of the companies listed in the same industry.
- GIS is valuated cheaply when we compare the Price/Forward Earnings ratio to 24.26, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.04 | ||
| Fwd PE | 11.77 |
4.2 Price Multiples
- GIS's Enterprise Value to EBITDA ratio is in line with the industry average.
- 75.86% of the companies in the same industry are more expensive than GIS, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.33 | ||
| EV/EBITDA | 10.38 |
4.3 Compensation for Growth
- The decent profitability rating of GIS may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)3.86
EPS Next 2Y-5.16%
EPS Next 3Y-1.49%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 5.35%, GIS is a good candidate for dividend investing.
- GIS's Dividend Yield is rather good when compared to the industry average which is at 2.28. GIS pays more dividend than 85.06% of the companies in the same industry.
- GIS's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.35% |
5.2 History
- The dividend of GIS has a limited annual growth rate of 4.25%.
- GIS has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)4.25%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- GIS pays out 52.10% of its income as dividend. This is a bit on the high side, but may be sustainable.
- GIS's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP52.1%
EPS Next 2Y-5.16%
EPS Next 3Y-1.49%
GENERAL MILLS INC / GIS FAQ
What is the fundamental rating for GIS stock?
ChartMill assigns a fundamental rating of 4 / 10 to GIS.
What is the valuation status of GENERAL MILLS INC (GIS) stock?
ChartMill assigns a valuation rating of 6 / 10 to GENERAL MILLS INC (GIS). This can be considered as Fairly Valued.
How profitable is GENERAL MILLS INC (GIS) stock?
GENERAL MILLS INC (GIS) has a profitability rating of 7 / 10.
What is the financial health of GENERAL MILLS INC (GIS) stock?
The financial health rating of GENERAL MILLS INC (GIS) is 3 / 10.
Can you provide the expected EPS growth for GIS stock?
The Earnings per Share (EPS) of GENERAL MILLS INC (GIS) is expected to decline by -12.33% in the next year.