Primo Water Corporation (PRMW.CA) Stock Fundamental Analysis

TSX:PRMW • CA74167P1080

37.4 CAD
+2.04 (+5.77%)
Last: Nov 12, 2024, 07:00 PM
Overview Stock Chart Technical Analysis Fundamental Analysis Analyst Ratings Earnings Estimates Financials Ownership News
Fundamental Rating

6

Taking everything into account, PRMW scores 6 out of 10 in our fundamental rating. PRMW was compared to 11 industry peers in the Beverages industry. PRMW gets an excellent profitability rating and is at the same time showing great financial health properties. PRMW has a valuation in line with the averages, but on the other hand it scores bad on growth.


Dividend Valuation Growth Profitability Health

8

1. Profitability

1.1 Basic Checks

  • PRMW had positive earnings in the past year.
  • In the past year PRMW had a positive cash flow from operations.
  • In multiple years PRMW reported negative net income over the last 5 years.
  • PRMW had a positive operating cash flow in each of the past 5 years.
PRMW.CA Yearly Net Income VS EBIT VS OCF VS FCFPRMW.CA Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 0 100M -100M 200M 300M

1.2 Ratios

  • PRMW's Return On Assets of 7.22% is amongst the best of the industry. PRMW outperforms 100.00% of its industry peers.
  • With an excellent Return On Equity value of 17.34%, PRMW belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
  • With an excellent Return On Invested Capital value of 4.13%, PRMW belongs to the best of the industry, outperforming 83.33% of the companies in the same industry.
  • Measured over the past 3 years, the Average Return On Invested Capital for PRMW is below the industry average of 6.91%.
  • The 3 year average ROIC (3.20%) for PRMW is below the current ROIC(4.13%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 7.22%
ROE 17.34%
ROIC 4.13%
ROA(3y)2.49%
ROA(5y)0.78%
ROE(3y)6.19%
ROE(5y)1.81%
ROIC(3y)3.2%
ROIC(5y)3.02%
PRMW.CA Yearly ROA, ROE, ROICPRMW.CA Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 0 10 20 30

1.3 Margins

  • The Profit Margin of PRMW (17.64%) is better than 100.00% of its industry peers.
  • In the last couple of years the Profit Margin of PRMW has declined.
  • Looking at the Operating Margin, with a value of 12.23%, PRMW belongs to the top of the industry, outperforming 83.33% of the companies in the same industry.
  • In the last couple of years the Operating Margin of PRMW has grown nicely.
  • PRMW has a better Gross Margin (68.16%) than 100.00% of its industry peers.
  • In the last couple of years the Gross Margin of PRMW has grown nicely.
Industry RankSector Rank
OM 12.23%
PM (TTM) 17.64%
GM 68.16%
OM growth 3Y10.6%
OM growth 5Y18.86%
PM growth 3YN/A
PM growth 5Y-8.87%
GM growth 3Y4.02%
GM growth 5Y2.34%
PRMW.CA Yearly Profit, Operating, Gross MarginsPRMW.CA Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 0 20 40 60

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ROAROEROICOperating and Profit MarginShow most profitable peers

7

2. Health

2.1 Basic Checks

  • The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so PRMW is destroying value.
  • Compared to 1 year ago, PRMW has about the same amount of shares outstanding.
  • PRMW has a better debt/assets ratio than last year.
PRMW.CA Yearly Shares OutstandingPRMW.CA Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 50M 100M 150M
PRMW.CA Yearly Total Debt VS Total AssetsPRMW.CA Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 1B 2B 3B 4B

2.2 Solvency

  • PRMW has an Altman-Z score of 3.77. This indicates that PRMW is financially healthy and has little risk of bankruptcy at the moment.
  • PRMW's Altman-Z score of 3.77 is amongst the best of the industry. PRMW outperforms 100.00% of its industry peers.
  • The Debt to FCF ratio of PRMW is 5.49, which is a neutral value as it means it would take PRMW, 5.49 years of fcf income to pay off all of its debts.
  • PRMW's Debt to FCF ratio of 5.49 is amongst the best of the industry. PRMW outperforms 83.33% of its industry peers.
  • PRMW has a Debt/Equity ratio of 0.86. This is a neutral value indicating PRMW is somewhat dependend on debt financing.
  • PRMW has a Debt to Equity ratio (0.86) which is comparable to the rest of the industry.
Industry RankSector Rank
Debt/Equity 0.86
Debt/FCF 5.49
Altman-Z 3.77
ROIC/WACC0.54
WACC7.71%
PRMW.CA Yearly LT Debt VS Equity VS FCFPRMW.CA Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 500M 1B 1.5B 2B

2.3 Liquidity

  • PRMW has a Current Ratio of 2.34. This indicates that PRMW is financially healthy and has no problem in meeting its short term obligations.
  • The Current ratio of PRMW (2.34) is comparable to the rest of the industry.
  • A Quick Ratio of 2.23 indicates that PRMW has no problem at all paying its short term obligations.
  • PRMW's Quick ratio of 2.23 is amongst the best of the industry. PRMW outperforms 83.33% of its industry peers.
Industry RankSector Rank
Current Ratio 2.34
Quick Ratio 2.23
PRMW.CA Yearly Current Assets VS Current LiabilitesPRMW.CA Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

3

3. Growth

3.1 Past

  • The Earnings Per Share has grown by an nice 12.20% over the past year.
  • The Earnings Per Share has been growing by 22.74% on average over the past years. This is a very strong growth
  • Looking at the last year, PRMW shows a very negative growth in Revenue. The Revenue has decreased by -36.45% in the last year.
  • PRMW shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -0.22% yearly.
EPS 1Y (TTM)12.2%
EPS 3Y15.98%
EPS 5Y22.74%
EPS Q2Q%6.06%
Revenue 1Y (TTM)-36.45%
Revenue growth 3Y-3.2%
Revenue growth 5Y-0.22%
Sales Q2Q%-17.78%

3.2 Future

  • PRMW is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.95% yearly.
  • PRMW is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.75% yearly.
EPS Next Y27.83%
EPS Next 2Y21.02%
EPS Next 3Y22.04%
EPS Next 5Y10.95%
Revenue Next Year-18.79%
Revenue Next 2Y-7.32%
Revenue Next 3Y-2.88%
Revenue Next 5Y-0.75%

3.3 Evolution

  • The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
  • The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
PRMW.CA Yearly Revenue VS EstimatesPRMW.CA Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 1B 2B 3B
PRMW.CA Yearly EPS VS EstimatesPRMW.CA Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 0 0.5 1

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5

4. Valuation

4.1 Price/Earnings Ratio

  • The Price/Earnings ratio is 28.99, which means the current valuation is very expensive for PRMW.
  • Compared to the rest of the industry, the Price/Earnings ratio of PRMW indicates a rather cheap valuation: PRMW is cheaper than 83.33% of the companies listed in the same industry.
  • The average S&P500 Price/Earnings ratio is at 27.19. PRMW is around the same levels.
  • PRMW is valuated rather expensively with a Price/Forward Earnings ratio of 23.41.
  • Compared to the rest of the industry, the Price/Forward Earnings ratio of PRMW indicates a somewhat cheap valuation: PRMW is cheaper than 75.00% of the companies listed in the same industry.
  • PRMW is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 28.06, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 28.99
Fwd PE 23.41
PRMW.CA Price Earnings VS Forward Price EarningsPRMW.CA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

  • 66.67% of the companies in the same industry are more expensive than PRMW, based on the Enterprise Value to EBITDA ratio.
  • Based on the Price/Free Cash Flow ratio, PRMW is valued a bit cheaper than 66.67% of the companies in the same industry.
Industry RankSector Rank
P/FCF 43.32
EV/EBITDA 32.56
PRMW.CA Per share dataPRMW.CA EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 2 4

4.3 Compensation for Growth

  • PRMW's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
  • The excellent profitability rating of PRMW may justify a higher PE ratio.
  • PRMW's earnings are expected to grow with 22.04% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.04
PEG (5Y)1.27
EPS Next 2Y21.02%
EPS Next 3Y22.04%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

6

5. Dividend

5.1 Amount

  • With a Yearly Dividend Yield of 1.34%, PRMW has a reasonable but not impressive dividend return.
  • Compared to an average industry Dividend Yield of 2.67, PRMW pays a bit more dividend than its industry peers.
  • PRMW's Dividend Yield is slightly below the S&P500 average, which is at 1.82.
Industry RankSector Rank
Dividend Yield 1.34%

5.2 History

  • The dividend of PRMW has a limited annual growth rate of 1.16%.
  • PRMW has been paying a dividend for at least 10 years, so it has a reliable track record.
  • PRMW has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)1.16%
Div Incr Years2
Div Non Decr Years11
PRMW.CA Yearly Dividends per sharePRMW.CA Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 0.2 0.4 0.6 0.8 1

5.3 Sustainability

  • PRMW pays out 22.12% of its income as dividend. This is a sustainable payout ratio.
  • PRMW's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP22.12%
EPS Next 2Y21.02%
EPS Next 3Y22.04%
PRMW.CA Yearly Income VS Free CF VS DividendPRMW.CA Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 0 100M -100M 200M 300M
PRMW.CA Dividend Payout.PRMW.CA Dividend Payout, showing the Payout Ratio.PRMW.CA Dividend Payout.PayoutRetained Earnings

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Primo Water Corporation

TSX:PRMW (11/12/2024, 7:00:00 PM)

37.4

+2.04 (+5.77%)

Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)11-07
Earnings (Next)N/A
Inst Owners73.03%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap14.17B
Revenue(TTM)1.46B
Net Income(TTM)257.20M
Analysts82.86
Price Target22.44 (-40%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 1.34%
Yearly Dividend0.32
Dividend Growth(5Y)1.16%
DP22.12%
Div Incr Years2
Div Non Decr Years11
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.7%
Min EPS beat(2)1.96%
Max EPS beat(2)13.43%
EPS beat(4)3
Avg EPS beat(4)3.94%
Min EPS beat(4)-29.61%
Max EPS beat(4)29.96%
EPS beat(8)6
Avg EPS beat(8)7.5%
EPS beat(12)8
Avg EPS beat(12)8.05%
EPS beat(16)11
Avg EPS beat(16)10.17%
Revenue beat(2)1
Avg Revenue beat(2)0.77%
Min Revenue beat(2)-0.57%
Max Revenue beat(2)2.11%
Revenue beat(4)2
Avg Revenue beat(4)-5.76%
Min Revenue beat(4)-25.44%
Max Revenue beat(4)2.11%
Revenue beat(8)3
Avg Revenue beat(8)-3.87%
Revenue beat(12)4
Avg Revenue beat(12)-3.03%
Revenue beat(16)6
Avg Revenue beat(16)-2.3%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0%
EPS NY rev (3m)2.68%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.21%
Valuation
Industry RankSector Rank
PE 28.99
Fwd PE 23.41
P/S 6.95
P/FCF 43.32
P/OCF 28.67
P/B 6.84
P/tB N/A
EV/EBITDA 32.56
EPS(TTM)1.29
EY3.45%
EPS(NY)1.6
Fwd EY4.27%
FCF(TTM)0.86
FCFY2.31%
OCF(TTM)1.3
OCFY3.49%
SpS5.38
BVpS5.47
TBVpS-0.87
PEG (NY)1.04
PEG (5Y)1.27
Graham NumberN/A
Profitability
Industry RankSector Rank
ROA 7.22%
ROE 17.34%
ROCE 5.69%
ROIC 4.13%
ROICexc 5.25%
ROICexgc 17.26%
OM 12.23%
PM (TTM) 17.64%
GM 68.16%
FCFM 16.05%
ROA(3y)2.49%
ROA(5y)0.78%
ROE(3y)6.19%
ROE(5y)1.81%
ROIC(3y)3.2%
ROIC(5y)3.02%
ROICexc(3y)3.53%
ROICexc(5y)3.28%
ROICexgc(3y)11.83%
ROICexgc(5y)11.37%
ROCE(3y)4.6%
ROCE(5y)4.33%
ROICexgc growth 3Y3.08%
ROICexgc growth 5Y11.87%
ROICexc growth 3Y13.05%
ROICexc growth 5Y18.08%
OM growth 3Y10.6%
OM growth 5Y18.86%
PM growth 3YN/A
PM growth 5Y-8.87%
GM growth 3Y4.02%
GM growth 5Y2.34%
F-Score7
Asset Turnover0.41
Health
Industry RankSector Rank
Debt/Equity 0.86
Debt/FCF 5.49
Debt/EBITDA 3.84
Cap/Depr 78.79%
Cap/Sales 8.2%
Interest Coverage 3.21
Cash Conversion 107.09%
Profit Quality 90.98%
Current Ratio 2.34
Quick Ratio 2.23
Altman-Z 3.77
F-Score7
WACC7.71%
ROIC/WACC0.54
Cap/Depr(3y)80.99%
Cap/Depr(5y)73.85%
Cap/Sales(3y)8.7%
Cap/Sales(5y)7.71%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)12.2%
EPS 3Y15.98%
EPS 5Y22.74%
EPS Q2Q%6.06%
EPS Next Y27.83%
EPS Next 2Y21.02%
EPS Next 3Y22.04%
EPS Next 5Y10.95%
Revenue 1Y (TTM)-36.45%
Revenue growth 3Y-3.2%
Revenue growth 5Y-0.22%
Sales Q2Q%-17.78%
Revenue Next Year-18.79%
Revenue Next 2Y-7.32%
Revenue Next 3Y-2.88%
Revenue Next 5Y-0.75%
EBIT growth 1Y1.94%
EBIT growth 3Y7.06%
EBIT growth 5Y18.6%
EBIT Next Year86.15%
EBIT Next 3Y30.95%
EBIT Next 5Y15.23%
FCF growth 1Y367.07%
FCF growth 3Y56.46%
FCF growth 5Y60.54%
OCF growth 1Y31.01%
OCF growth 3Y25.74%
OCF growth 5Y19.02%

Primo Water Corporation / PRMW.CA FAQ

What is the fundamental rating for PRMW stock?

ChartMill assigns a fundamental rating of 6 / 10 to PRMW.CA.


What is the valuation status for PRMW stock?

ChartMill assigns a valuation rating of 5 / 10 to Primo Water Corporation (PRMW.CA). This can be considered as Fairly Valued.


What is the profitability of PRMW stock?

Primo Water Corporation (PRMW.CA) has a profitability rating of 8 / 10.


What is the valuation of Primo Water Corporation based on its PE and PB ratios?

The Price/Earnings (PE) ratio for Primo Water Corporation (PRMW.CA) is 28.99 and the Price/Book (PB) ratio is 6.84.


What is the expected EPS growth for Primo Water Corporation (PRMW.CA) stock?

The Earnings per Share (EPS) of Primo Water Corporation (PRMW.CA) is expected to grow by 27.83% in the next year.