KELLANOVA (K) Stock Fundamental Analysis
NYSE:K - New York Stock Exchange, Inc. - US4878361082 - Common Stock - Currency: USD
K gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 90 industry peers in the Food Products industry. K scores excellent on profitability, but there are concerns on its financial health. K has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year K was profitable.
K had a positive operating cash flow in the past year.
K had positive earnings in each of the past 5 years.
K had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 8.92%, K belongs to the top of the industry, outperforming 88.89% of the companies in the same industry.
With an excellent Return On Equity value of 35.25%, K belongs to the best of the industry, outperforming 96.67% of the companies in the same industry.
K has a better Return On Invested Capital (13.11%) than 92.22% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for K is above the industry average of 8.67%.
The 3 year average ROIC (11.99%) for K is below the current ROIC(13.11%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.92% | ||
| ROE | 35.25% | ||
| ROIC | 13.11% |
ROA(3y)6.62%
ROA(5y)7%
ROE(3y)29.96%
ROE(5y)34.02%
ROIC(3y)11.99%
ROIC(5y)11.58%
1.3 Margins
With an excellent Profit Margin value of 10.92%, K belongs to the best of the industry, outperforming 88.89% of the companies in the same industry.
K's Profit Margin has improved in the last couple of years.
K's Operating Margin of 15.51% is amongst the best of the industry. K outperforms 87.78% of its industry peers.
In the last couple of years the Operating Margin of K has grown nicely.
With an excellent Gross Margin value of 36.59%, K belongs to the best of the industry, outperforming 82.22% of the companies in the same industry.
K's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.51% | ||
| PM (TTM) | 10.92% | ||
| GM | 36.59% |
OM growth 3Y5.23%
OM growth 5Y6.89%
PM growth 3Y0.13%
PM growth 5Y8.3%
GM growth 3Y3.3%
GM growth 5Y2.28%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), K is creating some value.
K has more shares outstanding than it did 1 year ago.
K has more shares outstanding than it did 5 years ago.
The debt/assets ratio for K has been reduced compared to a year ago.
2.2 Solvency
K has an Altman-Z score of 3.50. This indicates that K is financially healthy and has little risk of bankruptcy at the moment.
K has a Altman-Z score of 3.50. This is in the better half of the industry: K outperforms 75.56% of its industry peers.
K has a debt to FCF ratio of 6.51. This is a slightly negative value and a sign of low solvency as K would need 6.51 years to pay back of all of its debts.
K's Debt to FCF ratio of 6.51 is fine compared to the rest of the industry. K outperforms 67.78% of its industry peers.
A Debt/Equity ratio of 1.43 is on the high side and indicates that K has dependencies on debt financing.
K's Debt to Equity ratio of 1.43 is on the low side compared to the rest of the industry. K is outperformed by 82.22% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.43 | ||
| Debt/FCF | 6.51 | ||
| Altman-Z | 3.5 |
ROIC/WACC1.57
WACC8.35%
2.3 Liquidity
A Current Ratio of 0.80 indicates that K may have some problems paying its short term obligations.
K's Current ratio of 0.80 is on the low side compared to the rest of the industry. K is outperformed by 78.89% of its industry peers.
A Quick Ratio of 0.52 indicates that K may have some problems paying its short term obligations.
K's Quick ratio of 0.52 is on the low side compared to the rest of the industry. K is outperformed by 72.22% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.8 | ||
| Quick Ratio | 0.52 |
3. Growth
3.1 Past
The earnings per share for K have decreased by -8.11% in the last year.
The Earnings Per Share has been decreasing by -0.46% on average over the past years.
The Revenue has been growing slightly by 2.96% in the past year.
The Revenue has been decreasing by -1.25% on average over the past years.
EPS 1Y (TTM)-8.11%
EPS 3Y-2.63%
EPS 5Y-0.46%
EPS Q2Q%-10.89%
Revenue 1Y (TTM)2.96%
Revenue growth 3Y-3.49%
Revenue growth 5Y-1.25%
Sales Q2Q%-3.66%
3.2 Future
Based on estimates for the next years, K will show a small growth in Earnings Per Share. The EPS will grow by 5.30% on average per year.
K is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.40% yearly.
EPS Next Y-0.18%
EPS Next 2Y2.2%
EPS Next 3Y2.96%
EPS Next 5Y5.3%
Revenue Next Year0.45%
Revenue Next 2Y1.38%
Revenue Next 3Y1.95%
Revenue Next 5Y2.4%
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 accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 21.95 indicates a rather expensive valuation of K.
K's Price/Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Earnings ratio of 25.91, K is valued at the same level.
The Price/Forward Earnings ratio is 20.41, which indicates a rather expensive current valuation of K.
Compared to the rest of the industry, the Price/Forward Earnings ratio of K indicates a somewhat cheap valuation: K is cheaper than 62.22% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.85, K is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.95 | ||
| Fwd PE | 20.41 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as K.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of K is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.83 | ||
| EV/EBITDA | 14.17 |
4.3 Compensation for Growth
K has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y2.2%
EPS Next 3Y2.96%
5. Dividend
5.1 Amount
K has a Yearly Dividend Yield of 2.78%.
K's Dividend Yield is a higher than the industry average which is at 4.58.
K's Dividend Yield is comparable with the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.78% |
5.2 History
The dividend of K has a limited annual growth rate of 1.51%.
K has been paying a dividend for at least 10 years, so it has a reliable track record.
K has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)1.51%
Div Incr Years0
Div Non Decr Years19
5.3 Sustainability
56.67% of the earnings are spent on dividend by K. This is a bit on the high side, but may be sustainable.
The dividend of K is growing, but earnings are growing more, so the dividend growth is sustainable.
DP56.67%
EPS Next 2Y2.2%
EPS Next 3Y2.96%
82.08
-0.05 (-0.06%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners82.7%
Inst Owner Change0.25%
Ins Owners0.72%
Ins Owner Change-4.83%
Market Cap28.34B
Analysts54.55
Price Target84.1 (2.46%)
Short Float %3.09%
Short Ratio3.78
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.78% |
Yearly Dividend2.26
Dividend Growth(5Y)1.51%
DP56.67%
Div Incr Years0
Div Non Decr Years19
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.95%
Min EPS beat(2)-12.53%
Max EPS beat(2)8.62%
EPS beat(4)3
Avg EPS beat(4)2.8%
Min EPS beat(4)-12.53%
Max EPS beat(4)9.89%
EPS beat(8)7
Avg EPS beat(8)7.81%
EPS beat(12)11
Avg EPS beat(12)7.62%
EPS beat(16)15
Avg EPS beat(16)8.34%
Revenue beat(2)0
Avg Revenue beat(2)-3.1%
Min Revenue beat(2)-4.93%
Max Revenue beat(2)-1.26%
Revenue beat(4)1
Avg Revenue beat(4)-1.62%
Min Revenue beat(4)-4.93%
Max Revenue beat(4)0.37%
Revenue beat(8)3
Avg Revenue beat(8)-0.28%
Revenue beat(12)7
Avg Revenue beat(12)0.61%
Revenue beat(16)10
Avg Revenue beat(16)0.52%
PT rev (1m)1.31%
PT rev (3m)1.77%
EPS NQ rev (1m)-2.49%
EPS NQ rev (3m)-2.65%
EPS NY rev (1m)-3.62%
EPS NY rev (3m)-3.77%
Revenue NQ rev (1m)-0.64%
Revenue NQ rev (3m)-0.76%
Revenue NY rev (1m)-0.9%
Revenue NY rev (3m)-1.86%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.95 | ||
| Fwd PE | 20.41 | ||
| P/S | 2.24 | ||
| P/FCF | 32.83 | ||
| P/OCF | 18.74 | ||
| P/B | 7.24 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.17 |
EPS(TTM)3.74
EY4.56%
EPS(NY)4.02
Fwd EY4.9%
FCF(TTM)2.5
FCFY3.05%
OCF(TTM)4.38
OCFY5.34%
SpS36.59
BVpS11.34
TBVpS-8.34
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.92% | ||
| ROE | 35.25% | ||
| ROCE | 17.6% | ||
| ROIC | 13.11% | ||
| ROICexc | 13.49% | ||
| ROICexgc | 33.43% | ||
| OM | 15.51% | ||
| PM (TTM) | 10.92% | ||
| GM | 36.59% | ||
| FCFM | 6.83% |
ROA(3y)6.62%
ROA(5y)7%
ROE(3y)29.96%
ROE(5y)34.02%
ROIC(3y)11.99%
ROIC(5y)11.58%
ROICexc(3y)12.48%
ROICexc(5y)11.99%
ROICexgc(3y)36.74%
ROICexgc(5y)35.13%
ROCE(3y)15.6%
ROCE(5y)14.99%
ROICexcg growth 3Y9.44%
ROICexcg growth 5Y7.97%
ROICexc growth 3Y8.64%
ROICexc growth 5Y9.53%
OM growth 3Y5.23%
OM growth 5Y6.89%
PM growth 3Y0.13%
PM growth 5Y8.3%
GM growth 3Y3.3%
GM growth 5Y2.28%
F-Score7
Asset Turnover0.82
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.43 | ||
| Debt/FCF | 6.51 | ||
| Debt/EBITDA | 2.41 | ||
| Cap/Depr | 174% | ||
| Cap/Sales | 5.14% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 64.84% | ||
| Profit Quality | 62.54% | ||
| Current Ratio | 0.8 | ||
| Quick Ratio | 0.52 | ||
| Altman-Z | 3.5 |
F-Score7
WACC8.35%
ROIC/WACC1.57
Cap/Depr(3y)144.93%
Cap/Depr(5y)131.73%
Cap/Sales(3y)4.42%
Cap/Sales(5y)4.17%
Profit Quality(3y)102.41%
Profit Quality(5y)100.55%
High Growth Momentum
Growth
EPS 1Y (TTM)-8.11%
EPS 3Y-2.63%
EPS 5Y-0.46%
EPS Q2Q%-10.89%
EPS Next Y-0.18%
EPS Next 2Y2.2%
EPS Next 3Y2.96%
EPS Next 5Y5.3%
Revenue 1Y (TTM)2.96%
Revenue growth 3Y-3.49%
Revenue growth 5Y-1.25%
Sales Q2Q%-3.66%
Revenue Next Year0.45%
Revenue Next 2Y1.38%
Revenue Next 3Y1.95%
Revenue Next 5Y2.4%
EBIT growth 1Y23.29%
EBIT growth 3Y1.56%
EBIT growth 5Y5.55%
EBIT Next Year25.67%
EBIT Next 3Y10.8%
EBIT Next 5Y7.6%
FCF growth 1Y-17.57%
FCF growth 3Y-0.47%
FCF growth 5Y13.92%
OCF growth 1Y-5.5%
OCF growth 3Y1.14%
OCF growth 5Y8.4%