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HOSTESS BRANDS INC (TWNK) Stock Fundamental Analysis

USA - NASDAQ:TWNK - US44109J1060 - Common Stock

33.3 USD
-0.05 (-0.15%)
Last: 11/6/2023, 8:00:01 PM
33.34 USD
+0.04 (+0.12%)
After Hours: 11/6/2023, 8:00:01 PM
Fundamental Rating

5

TWNK gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 87 industry peers in the Food Products industry. TWNK scores excellent on profitability, but there are some minor concerns on its financial health. TWNK is quite expensive at the moment. It does show a decent growth rate.


Dividend Valuation Growth Profitability Health

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7

1. Profitability

1.1 Basic Checks

TWNK had positive earnings in the past year.
TWNK had a positive operating cash flow in the past year.
TWNK had positive earnings in each of the past 5 years.
Each year in the past 5 years TWNK had a positive operating cash flow.
TWNK Yearly Net Income VS EBIT VS OCF VS FCFTWNK Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 50M 100M 150M 200M

1.2 Ratios

TWNK has a better Return On Assets (4.83%) than 63.44% of its industry peers.
TWNK has a Return On Equity of 9.18%. This is in the better half of the industry: TWNK outperforms 64.52% of its industry peers.
With a decent Return On Invested Capital value of 5.38%, TWNK is doing good in the industry, outperforming 63.44% of the companies in the same industry.
TWNK had an Average Return On Invested Capital over the past 3 years of 4.37%. This is significantly below the industry average of 28.34%.
The last Return On Invested Capital (5.38%) for TWNK is above the 3 year average (4.37%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 4.83%
ROE 9.18%
ROIC 5.38%
ROA(3y)3.36%
ROA(5y)2.84%
ROE(3y)6.69%
ROE(5y)5.91%
ROIC(3y)4.37%
ROIC(5y)3.94%
TWNK Yearly ROA, ROE, ROICTWNK Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 0 10 -10 20

1.3 Margins

With an excellent Profit Margin value of 12.28%, TWNK belongs to the best of the industry, outperforming 90.32% of the companies in the same industry.
In the last couple of years the Profit Margin of TWNK has declined.
TWNK has a better Operating Margin (16.91%) than 94.62% of its industry peers.
TWNK's Operating Margin has declined in the last couple of years.
TWNK has a Gross Margin of 34.99%. This is amongst the best in the industry. TWNK outperforms 87.10% of its industry peers.
In the last couple of years the Gross Margin of TWNK has declined.
Industry RankSector Rank
OM 16.91%
PM (TTM) 12.28%
GM 34.99%
OM growth 3Y3.8%
OM growth 5Y-7.44%
PM growth 3Y20.25%
PM growth 5Y-15.96%
GM growth 3Y1.25%
GM growth 5Y-4.03%
TWNK Yearly Profit, Operating, Gross MarginsTWNK Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 10 20 30 40

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5

2. Health

2.1 Basic Checks

TWNK has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
TWNK has less shares outstanding than it did 1 year ago.
Compared to 1 year ago, TWNK has an improved debt to assets ratio.
TWNK Yearly Shares OutstandingTWNK Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 20M 40M 60M 80M 100M
TWNK Yearly Total Debt VS Total AssetsTWNK Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 1B 2B 3B

2.2 Solvency

An Altman-Z score of 2.54 indicates that TWNK is not a great score, but indicates only limited risk for bankruptcy at the moment.
TWNK has a Altman-Z score (2.54) which is in line with its industry peers.
The Debt to FCF ratio of TWNK is 9.63, which is on the high side as it means it would take TWNK, 9.63 years of fcf income to pay off all of its debts.
TWNK has a Debt to FCF ratio of 9.63. This is in the better half of the industry: TWNK outperforms 63.44% of its industry peers.
A Debt/Equity ratio of 0.53 indicates that TWNK is somewhat dependend on debt financing.
TWNK's Debt to Equity ratio of 0.53 is in line compared to the rest of the industry. TWNK outperforms 48.39% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.53
Debt/FCF 9.63
Altman-Z 2.54
ROIC/WACC0.68
WACC7.88%
TWNK Yearly LT Debt VS Equity VS FCFTWNK Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 0 500M -500M 1B 1.5B

2.3 Liquidity

A Current Ratio of 1.80 indicates that TWNK should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.80, TWNK is in line with its industry, outperforming 54.84% of the companies in the same industry.
A Quick Ratio of 1.47 indicates that TWNK should not have too much problems paying its short term obligations.
With a decent Quick ratio value of 1.47, TWNK is doing good in the industry, outperforming 74.19% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 1.8
Quick Ratio 1.47
TWNK Yearly Current Assets VS Current LiabilitesTWNK Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 100M 200M 300M 400M

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5

3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 9.47% over the past year.
Measured over the past 5 years, TWNK shows a small growth in Earnings Per Share. The EPS has been growing by 7.36% on average per year.
Looking at the last year, TWNK shows a quite strong growth in Revenue. The Revenue has grown by 10.00% in the last year.
TWNK shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 11.84% yearly.
EPS 1Y (TTM)9.47%
EPS 3Y17.37%
EPS 5Y7.36%
EPS Q2Q%27.27%
Revenue 1Y (TTM)10%
Revenue growth 3Y14.38%
Revenue growth 5Y11.84%
Sales Q2Q%3.49%

3.2 Future

TWNK is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.80% yearly.
TWNK is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.32% yearly.
EPS Next Y18%
EPS Next 2Y13.51%
EPS Next 3Y11.36%
EPS Next 5Y8.8%
Revenue Next Year5.6%
Revenue Next 2Y5.07%
Revenue Next 3Y4.87%
Revenue Next 5Y4.32%

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 stable.
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.
TWNK Yearly Revenue VS EstimatesTWNK Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 500M 1B 1.5B
TWNK Yearly EPS VS EstimatesTWNK Yearly EPS VS EstimatesYearly EPS VS Estimates 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 0.5 1

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3

4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 32.02 indicates a quite expensive valuation of TWNK.
TWNK's Price/Earnings ratio is in line with the industry average.
TWNK's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.67.
The Price/Forward Earnings ratio is 26.64, which means the current valuation is very expensive for TWNK.
The rest of the industry has a similar Price/Forward Earnings ratio as TWNK.
When comparing the Price/Forward Earnings ratio of TWNK to the average of the S&P500 Index (23.33), we can say TWNK is valued inline with the index average.
Industry RankSector Rank
PE 32.02
Fwd PE 26.64
TWNK Price Earnings VS Forward Price EarningsTWNK Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

TWNK's Enterprise Value to EBITDA ratio is in line with the industry average.
The rest of the industry has a similar Price/Free Cash Flow ratio as TWNK.
Industry RankSector Rank
P/FCF 42.86
EV/EBITDA 17.97
TWNK Per share dataTWNK EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 -5 10

4.3 Compensation for Growth

TWNK's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of TWNK may justify a higher PE ratio.
PEG (NY)1.78
PEG (5Y)4.35
EPS Next 2Y13.51%
EPS Next 3Y11.36%

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0

5. Dividend

5.1 Amount

TWNK does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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HOSTESS BRANDS INC

NASDAQ:TWNK (11/6/2023, 8:00:01 PM)

After market: 33.34 +0.04 (+0.12%)

33.3

-0.05 (-0.15%)

Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)11-07 2023-11-07/bmo
Earnings (Next)02-19 2024-02-19/amc
Inst Owners0%
Inst Owner Change0%
Ins Owners19.27%
Ins Owner Change0%
Market Cap4.42B
Revenue(TTM)1.38B
Net Income(TTM)169.94M
Analysts70
Price Target34.74 (4.32%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.59%
Min EPS beat(2)2.05%
Max EPS beat(2)5.14%
EPS beat(4)4
Avg EPS beat(4)3.97%
Min EPS beat(4)1.05%
Max EPS beat(4)7.63%
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)1
Avg Revenue beat(2)-1.77%
Min Revenue beat(2)-3.6%
Max Revenue beat(2)0.06%
Revenue beat(4)3
Avg Revenue beat(4)0.55%
Min Revenue beat(4)-3.6%
Max Revenue beat(4)5.27%
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0.74%
PT rev (3m)16.56%
EPS NQ rev (1m)0.48%
EPS NQ rev (3m)-0.04%
EPS NY rev (1m)0%
EPS NY rev (3m)0.88%
Revenue NQ rev (1m)-0.87%
Revenue NQ rev (3m)-1.66%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.62%
Valuation
Industry RankSector Rank
PE 32.02
Fwd PE 26.64
P/S 3.2
P/FCF 42.86
P/OCF 17.7
P/B 2.39
P/tB N/A
EV/EBITDA 17.97
EPS(TTM)1.04
EY3.12%
EPS(NY)1.25
Fwd EY3.75%
FCF(TTM)0.78
FCFY2.33%
OCF(TTM)1.88
OCFY5.65%
SpS10.41
BVpS13.94
TBVpS-5.91
PEG (NY)1.78
PEG (5Y)4.35
Graham NumberN/A
Profitability
Industry RankSector Rank
ROA 4.83%
ROE 9.18%
ROCE 7.06%
ROIC 5.38%
ROICexc 5.54%
ROICexgc 30.86%
OM 16.91%
PM (TTM) 12.28%
GM 34.99%
FCFM 7.46%
ROA(3y)3.36%
ROA(5y)2.84%
ROE(3y)6.69%
ROE(5y)5.91%
ROIC(3y)4.37%
ROIC(5y)3.94%
ROICexc(3y)4.63%
ROICexc(5y)4.2%
ROICexgc(3y)35.07%
ROICexgc(5y)36.04%
ROCE(3y)5.74%
ROCE(5y)5.17%
ROICexgc growth 3Y-5.58%
ROICexgc growth 5Y-14.6%
ROICexc growth 3Y12.1%
ROICexc growth 5Y0.38%
OM growth 3Y3.8%
OM growth 5Y-7.44%
PM growth 3Y20.25%
PM growth 5Y-15.96%
GM growth 3Y1.25%
GM growth 5Y-4.03%
F-Score8
Asset Turnover0.39
Health
Industry RankSector Rank
Debt/Equity 0.53
Debt/FCF 9.63
Debt/EBITDA 3.32
Cap/Depr 235.98%
Cap/Sales 10.61%
Interest Coverage 4.78
Cash Conversion 84.43%
Profit Quality 60.75%
Current Ratio 1.8
Quick Ratio 1.47
Altman-Z 2.54
F-Score8
WACC7.88%
ROIC/WACC0.68
Cap/Depr(3y)149.99%
Cap/Depr(5y)132.08%
Cap/Sales(3y)7.02%
Cap/Sales(5y)6.24%
Profit Quality(3y)114.45%
Profit Quality(5y)131.78%
High Growth Momentum
Growth
EPS 1Y (TTM)9.47%
EPS 3Y17.37%
EPS 5Y7.36%
EPS Q2Q%27.27%
EPS Next Y18%
EPS Next 2Y13.51%
EPS Next 3Y11.36%
EPS Next 5Y8.8%
Revenue 1Y (TTM)10%
Revenue growth 3Y14.38%
Revenue growth 5Y11.84%
Sales Q2Q%3.49%
Revenue Next Year5.6%
Revenue Next 2Y5.07%
Revenue Next 3Y4.87%
Revenue Next 5Y4.32%
EBIT growth 1Y12.2%
EBIT growth 3Y18.73%
EBIT growth 5Y3.52%
EBIT Next Year45.07%
EBIT Next 3Y18.06%
EBIT Next 5Y17.33%
FCF growth 1Y-21.87%
FCF growth 3Y4.56%
FCF growth 5Y-1.62%
OCF growth 1Y34.54%
OCF growth 3Y20%
OCF growth 5Y8.73%