HNI Corporation engages in the design, manufacture, and marketing of office furniture and hearth products primarily in the United States, Canada, China, Hong Kong, India, and Taiwan. The company was founded in 1944 and is based in Muscatine, Iowa.
HNI Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Hni Corp with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Hni Corp ranked in the 68th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 150% on a DCF basis. In terms of the factors that were most noteworthy in this DCF analysis for HNI, they are:
The stock's equity weight, or the proportion of capital from equity relative to debt, is 86. Notably, its equity weight is greater than 68.54% of US equities in the Industrials sector yielding a positive free cash flow.
HNI's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 27.35% of tickers in our DCF set.
Hni Corp's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at 13.18. This coverage rate is greater than that of 81.42% of stocks we're observing for the purpose of forecasting via discounted cash flows.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Industrials that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as HNI, try BV, CLH, STN, CMRE, and SHYF.
For Q2, HNI ([[HNI]] +5.0%) reported revenues of $417.5M (-20.6% Y/Y) beats consensus by $37.56M; sales on organic basis dipped 21.2%.Residential building products segment operating profit rose 7.5% Y/Y led by acquiring residential building products distributors which increased sales $2.9M Y/Y.Gross margin narrowed 50 bps Y/Y due to lower volume,...
HNI Corporation (HNI) Q2 2020 Earnings Conference Call July 23, 2020 12:00 PM ET Company participants Matt McCall - Investor Relations and Corporate Development Jeff Lorenger - President and Chief Executive Officer Marshall Bridges - Senior Vice President and Chief Financial Officer Conference Call Participants Reuben Garner - The Benchmark...