GENERAL MILLS INC (GIS) Stock Fundamental Analysis
NYSE:GIS - New York Stock Exchange, Inc. - US3703341046 - Common Stock - Currency: USD
GIS gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 89 industry peers in the Food Products industry. GIS scores excellent on profitability, but there are concerns on its financial health. GIS has a valuation in line with the averages, but on the other hand it scores bad on growth. GIS also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
GIS had positive earnings in the past year.
GIS had a positive operating cash flow in the past year.
Each year in the past 5 years GIS has been profitable.
GIS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
GIS's Return On Assets of 7.82% is fine compared to the rest of the industry. GIS outperforms 78.65% of its industry peers.
GIS has a Return On Equity of 27.62%. This is amongst the best in the industry. GIS outperforms 95.51% of its industry peers.
Looking at the Return On Invested Capital, with a value of 11.48%, GIS belongs to the top of the industry, outperforming 84.27% of the companies in the same industry.
GIS had an Average Return On Invested Capital over the past 3 years of 11.19%. This is above the industry average of 9.00%.
The last Return On Invested Capital (11.48%) for GIS is above the 3 year average (11.19%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.82% | ||
| ROE | 27.62% | ||
| ROIC | 11.48% |
ROA(3y)8.3%
ROA(5y)7.86%
ROE(3y)25.69%
ROE(5y)25.77%
ROIC(3y)11.19%
ROIC(5y)11.05%
1.3 Margins
GIS's Profit Margin of 13.03% is amongst the best of the industry. GIS outperforms 93.26% of its industry peers.
In the last couple of years the Profit Margin of GIS has grown nicely.
GIS has a Operating Margin of 18.33%. This is amongst the best in the industry. GIS outperforms 93.26% of its industry peers.
GIS's Operating Margin has been stable in the last couple of years.
GIS has a better Gross Margin (35.38%) than 79.78% of its industry peers.
In the last couple of years the Gross Margin of GIS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.33% | ||
| PM (TTM) | 13.03% | ||
| GM | 35.38% |
OM growth 3Y-0.35%
OM growth 5Y1.11%
PM growth 3Y-0.88%
PM growth 5Y3.88%
GM growth 3Y-0.55%
GM growth 5Y0.17%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so GIS is still creating some value.
Compared to 1 year ago, GIS has less shares outstanding
The number of shares outstanding for GIS has been reduced compared to 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 2.57. 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.
Looking at the Altman-Z score, with a value of 2.57, GIS is in line with its industry, outperforming 53.93% of the companies in the same industry.
GIS has a debt to FCF ratio of 5.73. This is a neutral value as GIS would need 5.73 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 5.73, GIS is in the better half of the industry, outperforming 67.42% of the companies in the same industry.
A Debt/Equity ratio of 1.32 is on the high side and indicates that GIS has dependencies on debt financing.
GIS has a Debt to Equity ratio of 1.32. This is in the lower half of the industry: GIS underperforms 77.53% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.32 | ||
| Debt/FCF | 5.73 | ||
| Altman-Z | 2.57 |
ROIC/WACC1.58
WACC7.26%
2.3 Liquidity
A Current Ratio of 0.67 indicates that GIS may have some problems paying its short term obligations.
GIS has a Current ratio of 0.67. This is amonst the worse of the industry: GIS underperforms 83.15% of its industry peers.
GIS has a Quick Ratio of 0.67. 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 (0.44) than 77.53% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.44 |
3. Growth
3.1 Past
The earnings per share for GIS have decreased by -3.24% in the last year.
The Earnings Per Share has been growing slightly by 7.02% on average over the past years.
Looking at the last year, GIS shows a decrease in Revenue. The Revenue has decreased by -2.62% in the last year.
GIS shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.32% yearly.
EPS 1Y (TTM)-3.24%
EPS 3Y6.05%
EPS 5Y7.02%
EPS Q2Q%-14.53%
Revenue 1Y (TTM)-2.62%
Revenue growth 3Y3.09%
Revenue growth 5Y3.32%
Sales Q2Q%-5.04%
3.2 Future
The Earnings Per Share is expected to grow by 1.39% on average over the next years.
GIS is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.77% yearly.
EPS Next Y-6.3%
EPS Next 2Y-4.58%
EPS Next 3Y-1.42%
EPS Next 5Y1.39%
Revenue Next Year-2.41%
Revenue Next 2Y-2.05%
Revenue Next 3Y-1.42%
Revenue Next 5Y-0.77%
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.
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 12.37, GIS is valued correctly.
Based on the Price/Earnings ratio, GIS is valued a bit cheaper than the industry average as 70.79% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 28.22, GIS is valued rather cheaply.
With a Price/Forward Earnings ratio of 13.47, GIS is valued correctly.
75.28% of the companies in the same industry are more expensive than GIS, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 20.86. GIS is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.37 | ||
| Fwd PE | 13.47 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GIS is on the same level as its industry peers.
Based on the Price/Free Cash Flow ratio, GIS is valued a bit cheaper than the industry average as 74.16% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.26 | ||
| EV/EBITDA | 10.54 |
4.3 Compensation for Growth
The excellent profitability rating of GIS may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.76
EPS Next 2Y-4.58%
EPS Next 3Y-1.42%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.26%, GIS is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 4.38, GIS pays a better dividend. On top of this GIS pays more dividend than 85.39% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.44, GIS pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.26% |
5.2 History
The dividend of GIS has a limited annual growth rate of 3.77%.
GIS has been paying a dividend for at least 10 years, so it has a reliable track record.
GIS has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)3.77%
Div Incr Years4
Div Non Decr Years33
5.3 Sustainability
52.52% of the earnings are spent on dividend by GIS. This is a bit on the high side, but may be sustainable.
The dividend of GIS is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP52.52%
EPS Next 2Y-4.58%
EPS Next 3Y-1.42%
55.43
-0.15 (-0.27%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners83.24%
Inst Owner Change-0.2%
Ins Owners0.26%
Ins Owner Change0%
Market Cap30.35B
Analysts66.92
Price Target63.45 (14.47%)
Short Float %5.35%
Short Ratio4.6
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.26% |
Yearly Dividend2.38
Dividend Growth(5Y)3.77%
DP52.52%
Div Incr Years4
Div Non Decr Years33
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.59%
Min EPS beat(2)3.36%
Max EPS beat(2)13.83%
EPS beat(4)4
Avg EPS beat(4)4.49%
Min EPS beat(4)0.06%
Max EPS beat(4)13.83%
EPS beat(8)7
Avg EPS beat(8)4.96%
EPS beat(12)11
Avg EPS beat(12)5.43%
EPS beat(16)14
Avg EPS beat(16)5.14%
Revenue beat(2)1
Avg Revenue beat(2)-1.22%
Min Revenue beat(2)-3.37%
Max Revenue beat(2)0.93%
Revenue beat(4)1
Avg Revenue beat(4)-1.57%
Min Revenue beat(4)-3.84%
Max Revenue beat(4)0.93%
Revenue beat(8)2
Avg Revenue beat(8)-1.74%
Revenue beat(12)4
Avg Revenue beat(12)-1.04%
Revenue beat(16)7
Avg Revenue beat(16)-0.22%
PT rev (1m)-6.41%
PT rev (3m)-12.86%
EPS NQ rev (1m)0.08%
EPS NQ rev (3m)-32.96%
EPS NY rev (1m)0.03%
EPS NY rev (3m)-7.1%
Revenue NQ rev (1m)-0.04%
Revenue NQ rev (3m)-5.41%
Revenue NY rev (1m)-1.41%
Revenue NY rev (3m)-2.11%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.37 | ||
| Fwd PE | 13.47 | ||
| P/S | 1.55 | ||
| P/FCF | 12.26 | ||
| P/OCF | 9.57 | ||
| P/B | 3.28 | ||
| P/tB | N/A | ||
| EV/EBITDA | 10.54 |
EPS(TTM)4.48
EY8.08%
EPS(NY)4.12
Fwd EY7.43%
FCF(TTM)4.52
FCFY8.16%
OCF(TTM)5.79
OCFY10.44%
SpS35.87
BVpS16.92
TBVpS-24.31
PEG (NY)N/A
PEG (5Y)1.76
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.82% | ||
| ROE | 27.62% | ||
| ROCE | 14.5% | ||
| ROIC | 11.48% | ||
| ROICexc | 11.72% | ||
| ROICexgc | 135.48% | ||
| OM | 18.33% | ||
| PM (TTM) | 13.03% | ||
| GM | 35.38% | ||
| FCFM | 12.61% |
ROA(3y)8.3%
ROA(5y)7.86%
ROE(3y)25.69%
ROE(5y)25.77%
ROIC(3y)11.19%
ROIC(5y)11.05%
ROICexc(3y)11.5%
ROICexc(5y)11.59%
ROICexgc(3y)142.43%
ROICexgc(5y)203.07%
ROCE(3y)14.09%
ROCE(5y)13.92%
ROICexcg growth 3Y-26.03%
ROICexcg growth 5Y9.28%
ROICexc growth 3Y-0.15%
ROICexc growth 5Y4.48%
OM growth 3Y-0.35%
OM growth 5Y1.11%
PM growth 3Y-0.88%
PM growth 5Y3.88%
GM growth 3Y-0.55%
GM growth 5Y0.17%
F-Score6
Asset Turnover0.6
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.32 | ||
| Debt/FCF | 5.73 | ||
| Debt/EBITDA | 2.96 | ||
| Cap/Depr | 127.52% | ||
| Cap/Sales | 3.53% | ||
| Interest Coverage | 7.63 | ||
| Cash Conversion | 76.5% | ||
| Profit Quality | 96.8% | ||
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.44 | ||
| Altman-Z | 2.57 |
F-Score6
WACC7.26%
ROIC/WACC1.58
Cap/Depr(3y)121.97%
Cap/Depr(5y)106.34%
Cap/Sales(3y)3.44%
Cap/Sales(5y)3.17%
Profit Quality(3y)94.44%
Profit Quality(5y)107.11%
High Growth Momentum
Growth
EPS 1Y (TTM)-3.24%
EPS 3Y6.05%
EPS 5Y7.02%
EPS Q2Q%-14.53%
EPS Next Y-6.3%
EPS Next 2Y-4.58%
EPS Next 3Y-1.42%
EPS Next 5Y1.39%
Revenue 1Y (TTM)-2.62%
Revenue growth 3Y3.09%
Revenue growth 5Y3.32%
Sales Q2Q%-5.04%
Revenue Next Year-2.41%
Revenue Next 2Y-2.05%
Revenue Next 3Y-1.42%
Revenue Next 5Y-0.77%
EBIT growth 1Y-1.75%
EBIT growth 3Y2.72%
EBIT growth 5Y4.47%
EBIT Next Year8.65%
EBIT Next 3Y2.53%
EBIT Next 5Y2.37%
FCF growth 1Y-2.71%
FCF growth 3Y1.02%
FCF growth 5Y2.19%
OCF growth 1Y1.78%
OCF growth 3Y3.45%
OCF growth 5Y3.31%