Hormel Foods produces and markets various meat and food products worldwide. The company operates in five segments: Grocery Products, Refrigerated Foods, Jennie-O Turkey Store, Specialty Foods, and International & Other. The company was founded in 1891 and is based in Austin, Minnesota.
HRL Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for HRL, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Hormel Foods Corp ranked in the 25th percentile in terms of potential gain offered. We should note, though, that the most conservative analysis suggests this stock will yield negative results -- and thus may be a potential short opportunity. The most interesting components of our discounted cash flow analysis for Hormel Foods Corp ended up being:
The company's debt burden, as measured by earnings divided by interest payments, is 73.96 -- which is good for besting 94.15% of its peer stocks (US stocks in the Consumer Defensive sector with positive cash flow).
The business' balance sheet suggests that 5% of the company's capital is sourced from debt; this is greater than merely 14.48% of the free cash flow producing stocks we're observing.
HRL'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 44.13% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Hormel Foods Corp? See AGFS, EPC, TPB, GNCIQ, and IPAR.
AUSTIN, Minn., Oct. 2, 2020 /PRNewswire/ -- Hormel Foods Corporation (NYSE: HRL), a global branded food company, has announced its participation in the Dine, Shop & Share for No Kid Hungry campaign, aimed at raising funds to help kids get the meals they need to learn. In addition to a…
AUSTIN, Minn., Sept. 29, 2020 /PRNewswire/ -- Hormel Foods Corporation (NYSE: HRL), a global branded food company, announced today that its quarterly dividend on the common stock, authorized by the Board of Directors at 23.25 cents ($0.2325) a share on September 29, 2020, will be paid…
AUSTIN, Minn., Sept. 23, 2020 /PRNewswire/ -- Hormel Foods Corporation (NYSE: HRL) today announced the launch of its 14th annual corporate responsibility (CR) report. The report is available online at https://csr.hormelfoods.com/ and includes information about the company's CR progress in…
I love the consumer staples business to form the core of my dividend growth portfolio. The reason being that they typically sell goods that are consumed rather quickly and create repeat customers. Hormel Foods (HRL) has several recognizable brands outside of their namesake. Brands such as Spam, Wholly Guacamole, Jennie-O...
Passive Income Pursuit on Seeking Alpha | September 21, 2020