Middleby Corp

MIDD

Refrigeration & Service Industry Machinery

Mkt Cap

$6.618B

PE

17.04

Debt

$2.459B

Cash

$341M

EV

$8.737B

FCF

$604.3M

Market Cap

$6.618B

P/E Ratio

17.04

Debt

$2.459B

Cash

$341M

EV

$8.737B

FCF

$604.3M

Charts data: {"Earnings":[{"time":"2015-01-02","value":193312000},{"time":"2016-01-01","value":191610000},{"time":"2016-12-30","value":284216000},{"time":"2017-12-29","value":298128000},{"time":"2018-12-28","value":317152000},{"time":"2019-12-27","value":352240000},{"time":"2021-01-01","value":207294000},{"time":"2021-12-31","value":488492000},{"time":"2022-12-30","value":436569000},{"time":"2023-12-29","value":400882000}],"Sales":[{"time":"2015-01-02","value":1636538000},{"time":"2016-01-01","value":1826598000},{"time":"2016-12-30","value":2267852000},{"time":"2017-12-29","value":2335542000},{"time":"2018-12-28","value":2722931000},{"time":"2019-12-27","value":2959446000},{"time":"2021-01-01","value":2513257000},{"time":"2021-12-31","value":3250792000},{"time":"2022-12-30","value":4032853000},{"time":"2023-12-29","value":4036605000}],"Net Margins":[{"time":"2015-01-02","value":0.1181225244998894},{"time":"2016-01-01","value":0.10489992871994823},{"time":"2016-12-30","value":0.12532387475020415},{"time":"2017-12-29","value":0.12764831460962808},{"time":"2018-12-28","value":0.11647449017253834},{"time":"2019-12-27","value":0.11902227646660896},{"time":"2021-01-01","value":0.08248022386886816},{"time":"2021-12-31","value":0.15026861146452927},{"time":"2022-12-30","value":0.10825313989872679},{"time":"2023-12-29","value":0.09931167404291477}],"Assets":[{"time":"2015-01-02","value":2066131000},{"time":"2016-01-01","value":2761151000},{"time":"2016-12-30","value":2917136000},{"time":"2017-12-29","value":3339713000},{"time":"2018-12-28","value":4549781000},{"time":"2019-12-27","value":5002143000},{"time":"2021-01-01","value":5202474000},{"time":"2021-12-31","value":6383598000},{"time":"2022-12-30","value":6874866000},{"time":"2023-12-29","value":6906692000}],"Stockholders Equity":[{"time":"2015-01-02","value":1006760000},{"time":"2016-01-01","value":1166830000},{"time":"2016-12-30","value":1265318000},{"time":"2017-12-29","value":1361148000},{"time":"2018-12-28","value":1665203000},{"time":"2019-12-27","value":1946814000},{"time":"2021-01-01","value":1976649000},{"time":"2021-12-31","value":2494276000},{"time":"2022-12-30","value":2797747000},{"time":"2023-12-29","value":3249889000}],"ROE":[{"time":"2015-01-02","value":0.19201398545830187},{"time":"2016-01-01","value":0.16421415287574026},{"time":"2016-12-30","value":0.22462021404895843},{"time":"2017-12-29","value":0.21902688025108216},{"time":"2018-12-28","value":0.1904584606201166},{"time":"2019-12-27","value":0.18093151169038232},{"time":"2021-01-01","value":0.1048714263382118},{"time":"2021-12-31","value":0.1958452071863739},{"time":"2022-12-30","value":0.15604305893277698},{"time":"2023-12-29","value":0.12335252065532085}],"ROA":[{"time":"2015-01-02","value":0.1454080113990836},{"time":"2016-01-01","value":0.10959306463138017},{"time":"2016-12-30","value":0.1529668140258116},{"time":"2017-12-29","value":0.12286714457200364},{"time":"2018-12-28","value":0.10599521163765904},{"time":"2019-12-27","value":0.10899888307871246},{"time":"2021-01-01","value":0.06663637338696936},{"time":"2021-12-31","value":0.09868917184321443},{"time":"2022-12-30","value":0.09303512243002264},{"time":"2023-12-29","value":0.09192070531015427}]}

The Middleby Corporation designs, manufactures, markets, distributes, and services foodservice, food processing, and residential kitchen equipment worldwide. Its Commercial Foodservice Equipment Group segment offers conveyor, combi, convection, baking, proofing, deck, speed cooking, and hydrovection ovens; ranges, fryers, and rethermalizers; steam cooking, food warming, catering, induction cooking, and countertop cooking equipment; heated cabinets, charbroilers, ventless cooking systems, kitchen ventilation, toasters, griddles, charcoal grills, professional mixers, stainless steel fabrication, custom millwork, professional refrigerators, blast chillers, cold rooms, ice machines, and freezers; soft serve ice cream, coffee and beverage dispensing, home and professional craft brewing equipment; and fry dispensers, bottle filling and canning equipment, and IoT solutions. The Food Processing Equipment Group segment provides batch, baking, proofing, conveyor belt, and continuous processing ovens; frying and automated thermal processing systems; tumblers, massagers, grinders, slicers, reduction and emulsion systems, mixers, formers, and blenders; battering, breading, and seeding equipment; water cutting systems, food presses, food suspension equipment, filling and depositing solutions, and forming equipment; and food safety, food handling, freezing, and defrosting and packaging equipment for customers producing hot dog, dinner sausage, poultry, and lunchmeat, as well as bakery products. Its Residential Kitchen Equipment Group segment offers kitchen equipment comprising cookers, stoves, cooktops, microwaves, ovens, refrigerators, dishwashers, undercounter refrigeration, wine cellars, ice machines, beer dispensers, mixers, rotisseries, and ventilation and outdoor cooking equipment. The company was formerly known as Middleby Marshall Oven Company and changed its name to The Middleby Corporation in 1985. The company was founded in 1888 and is headquartered in Elgin, Illinois.

Sector

HAYW

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10-Q
3/31/18
10-K
12/30/17

DCF

Discounted Cash Flow Valuation of Middleby Corp

Calculate

Growth Years

Growth

Start

End

Discount

Start

End

Multiple

g\r	+10%	+11%	+12%	+13%	+14%
0%	10	9	8	8	7
+1%	11	10	9	8	8
+2%	13	11	10	9	8
+3%	14	13	11	10	9
+4%	17	14	12	11	10

Years	0	1	2	3	4	5	6	7	8	9	10	TV
FCF	$604.3M	$649.4M	$696.1M	$744.3M	$793.7M	$844.3M	$895.8M	$948M	$1.001B	$1.053B	$1.106B	$11.06B
DCF		$564.7M	$526.4M	$489.4M	$453.8M	$419.8M	$387.3M	$356.4M	$327.1M	$299.4M	$273.4M	$2.734B
Value	$6.831B

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth 8.7%

Earnings Stability 62%

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

The Net Margin is too low to guarantee profitability in case of higher costs or higher interest rates. Furthermore lower margins cause higher earnings’ volatility.

Over time the ROA has been decreasing indicating a lower marginal ROA with respect to the calculated one, this could impede growth.

Years	01-2016	12-2016	12-2017	12-2018	12-2019	01-2021	12-2021	12-2022	12-2023	TTM
Net Margin	10%	13%	13%	12%	12%	8.2%	15%	11%	9.9%	9.8%
ROA	11%	15%	12%	11%	11%	6.7%	9.9%	9.3%	9.2%	8.8%
ROE	16%	22%	22%	19%	18%	10%	20%	16%	12%	12%

What is the average Net Margin?

The average Net Margin over the past 5 years is +11.26%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is -0.14%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +9.42%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is -0.25%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is +15.86%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is -0.91%.

Safety & Stabiliy

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

The company has high debt with respect to the cashflow it generates.

The Graham’s stability indicate a relevant drawdown, consider checking when it has occured and why.

Years	01-2016	12-2016	12-2017	12-2018	12-2019	01-2021	12-2021	12-2022	12-2023	TTM
Debt FCF	3.51	2.74	4.14	5.69	5.67	3.58	6.48	10.43	4.54	4.07
Debt Equity	0.68	0.58	0.76	1.14	0.96	0.89	0.98	0.99	0.76	0.74
MIN
Graham Stability	-	-	100%	100%	100%	64%	100%	100%	100%	64%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 4.07.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is 0.33.

What is the Graham’s Stability?

Graham’s Stability measure stands at 0.64.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Earnings growth has been increasing in past years.

Years	12-2016	12-2018	01-2021	12-2022	Trend
Revenue	8.6%	8.2%	17%	0.093%	-0.42%
Net Income	5%	4.8%	25%	-8.2%	0.13%
Stockholders Equity	14%	14%	18%	16%	0.48%
FCF	11%	10%	3.5%	100%	4.1%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +8.19%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is -0.42%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is +4.8%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is +0.13%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +14.31%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is +0.48%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is +10.31%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is +4.11%.