Poultry Slaughtering and Processing
Pilgrim's Pride Corporation engages in the production, processing, marketing and distribution of fresh, frozen and value-added chicken, and pork products to retailers, distributors, and foodservice operators in the United States, the United Kingdom, Mexico, the Middle East, Asia, Continental Europe, and internationally. The company offers fresh products, including pre-marinated or non-marinated chicken, frozen whole chickens, breast fillets, mini breast fillets and prepackaged case-ready chicken, primary pork cuts, and pork and pork ribs; and prepared products, which include portion-controlled breast fillets, tenderloins and strips, delicatessen products, salads, formed nuggets and patties, bone-in chicken parts, processed sausages, bacon, slow cooked, smoked meat, and gammon joints, as well as variety of meat products, pre-packed meats, sandwich and deli counter meats, pulled pork balls, meatballs, and coated foods. In addition, its exported products include whole chickens and chicken parts sold either refrigerated for distributors in the U.S. or frozen for distribution to export markets and primary pork cuts, hog heads, and trotters frozen for distribution to export markets. The company offers its products under the Pilgrim's, Just BARE, Gold'n Pump, Gold Kist, County Pride, Pierce Chicken, Pilgrim's Mexico, County Post, Savoro, To-Ricos, Del Dia, Moy Park, O'Kane, Richmond, Fridge Raiders, and Denny brands. Pilgrim's Pride Corporation sells its products to the foodservice market principally consists of chain restaurants, food processors, broad-line distributors, and other institutions; and retail market, which comprise primarily grocery store chains, wholesale clubs, and other retail distributors. The company was founded in 1946 and is headquartered in Greeley, Colorado. Pilgrim's Pride Corporation is a subsidiary of JBS S.A.
Sector
Discounted Cash Flow Valuation of Pilgrims Pride Corp
Growth
%
%
Discount
%
%
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 | $585.4M | $506.9M | $438.9M | $380M | $329M | $284.9M | $246.7M | $213.6M | $184.9M | $160.1M | $138.6M | $1.386B |
DCF | $440.8M | $331.8M | $249.9M | $188.1M | $141.6M | $106.6M | $80.29M | $60.45M | $45.51M | $34.27M | $342.7M | |
Value | $2.022B |
In the chart Earnings are multiplied by this value.
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.
Years | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Net Margin | 7.9% | 4.5% | 6.5% | 2.3% | 4% | 0.78% | 0.21% | 4.3% | 1.9% | 2.8% |
ROA | 31% | 24% | 17% | 8.4% | 11% | 3.9% | 2.4% | 13% | 5.3% | 7.6% |
ROE | 51% | 49% | 37% | 12% | 18% | 3.7% | 1.2% | 26% | 9.6% | 14% |
The average Net Margin over the past 5 years is +2.23%.
The trend of Net Margin over the past 5 years is -0.05%.
The average ROA over the past 5 years is +7.2%.
The trend of ROA over the past 5 years is -0.29%.
The average ROE over the past 5 years is +11.81%.
The trend of ROE over the past 5 years is +0.26%.
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.
Years | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Debt FCF | 1.28 | 2.12 | 5.97 | 16.67 | 7.38 | 6.29 | -59.29 | 17.77 | 27.83 | 5.71 |
Debt Equity | 0.82 | 1.14 | 1.49 | 1.18 | 0.93 | 0.90 | 1.26 | 1.14 | 1.00 | 0.96 |
MIN | ||||||||||
Graham Stability | - | - | 100% | 42% | 99% | 20% | 12% | 100% | 100% | 12% |
The Debt/FCF trailing twelve month is 5.71.
The trend of Debt/FCF over the past 5 years is 0.61.
Graham’s Stability measure stands at 0.12.
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.
Years | 12-2016 | 12-2018 | 12-2020 | 12-2022 | Trend |
---|---|---|---|---|---|
Revenue | 8.4% | 9.7% | 13% | -0.61% | 0.66% |
Net Income | -4.4% | 5.4% | 50% | -57% | 110% |
Stockholders Equity | 21% | 11% | 9.1% | 17% | 2.3% |
FCF | -18% | -3.4% | -31% | -34% | 2.4% |
The Revenue CAGR over the past 5 years is +9.68%.
The trend of Revenue growth rate over the past 5 years is +0.66%.
The Earnings CAGR over the past 5 years is +5.44%.
The trend of Earnings growth rate over the past 5 years is +109.31%.
The Equity CAGR over the past 5 years is +10.62%.
The trend of Equity growth rate over the past 5 years is +2.27%.
The FCF CAGR over the past 5 years is -3.43%.
The trend of FCF growth rate over the past 5 years is +2.4%.