Pilgrims Pride Corp

PPC

Poultry Slaughtering and Processing

Mkt Cap

$8.55B

PE

17.42

Debt

$3.343B

Cash

$894.9M

EV

$11B

FCF

$585.4M

Market Cap

$8.55B

P/E Ratio

17.42

Debt

$3.343B

Cash

$894.9M

EV

$11B

FCF

$585.4M

Charts data: {"Earnings":[{"time":"2014-12-27","value":711438000},{"time":"2015-12-26","value":645914000},{"time":"2016-12-24","value":439729000},{"time":"2017-12-30","value":694579000},{"time":"2018-12-29","value":246804000},{"time":"2019-12-28","value":455924000},{"time":"2020-12-26","value":94757000},{"time":"2021-12-25","value":31000000},{"time":"2022-12-24","value":745930000},{"time":"2023-12-30","value":321574000}],"Sales":[{"time":"2014-12-27","value":8583365000},{"time":"2015-12-26","value":8180104000},{"time":"2016-12-24","value":9878564000},{"time":"2017-12-30","value":10767863000},{"time":"2018-12-29","value":10937784000},{"time":"2019-12-28","value":11409219000},{"time":"2020-12-26","value":12091901000},{"time":"2021-12-25","value":14777458000},{"time":"2022-12-24","value":17468377000},{"time":"2023-12-30","value":17362217000}],"Net Margins":[{"time":"2014-12-27","value":0.08288567479071436},{"time":"2015-12-26","value":0.07896158777443417},{"time":"2016-12-24","value":0.04451345357483132},{"time":"2017-12-30","value":0.06450481400069819},{"time":"2018-12-29","value":0.022564351243359714},{"time":"2019-12-28","value":0.03996101748945305},{"time":"2020-12-26","value":0.007836402233197245},{"time":"2021-12-25","value":0.002097789755179815},{"time":"2022-12-24","value":0.04270173468319352},{"time":"2023-12-30","value":0.0185214825963758}],"Assets":[{"time":"2014-12-27","value":3119063000},{"time":"2015-12-26","value":3318443000},{"time":"2016-12-24","value":3008218000},{"time":"2017-12-30","value":6248652000},{"time":"2018-12-29","value":5931202000},{"time":"2019-12-28","value":7102364000},{"time":"2020-12-26","value":7474497000},{"time":"2021-12-25","value":8913205000},{"time":"2022-12-24","value":9255769000},{"time":"2023-12-30","value":9810361000}],"Stockholders Equity":[{"time":"2014-12-27","value":2196801000},{"time":"2015-12-26","value":1261810000},{"time":"2016-12-24","value":896747000},{"time":"2017-12-30","value":1855661000},{"time":"2018-12-29","value":2019585000},{"time":"2019-12-28","value":2536060000},{"time":"2020-12-26","value":2575347000},{"time":"2021-12-25","value":2588934000},{"time":"2022-12-24","value":2853276000},{"time":"2023-12-30","value":3344577000}],"ROE":[{"time":"2014-12-27","value":0.3238518190769214},{"time":"2015-12-26","value":0.5118948177617867},{"time":"2016-12-24","value":0.49036015732419513},{"time":"2017-12-30","value":0.3743027417184496},{"time":"2018-12-29","value":0.12220530455514375},{"time":"2019-12-28","value":0.17977650371048004},{"time":"2020-12-26","value":0.03679387670865324},{"time":"2021-12-25","value":0.011974040280671503},{"time":"2022-12-24","value":0.2614293184395761},{"time":"2023-12-30","value":0.09614788357391682}],"ROA":[{"time":"2014-12-27","value":0.385729624569943},{"time":"2015-12-26","value":0.3148738730784286},{"time":"2016-12-24","value":0.23886433762446738},{"time":"2017-12-30","value":0.17431743678476574},{"time":"2018-12-29","value":0.08357260467608421},{"time":"2019-12-28","value":0.10562328261407047},{"time":"2020-12-26","value":0.03852339495219544},{"time":"2021-12-25","value":0.023691141401998496},{"time":"2022-12-24","value":0.12712017769674244},{"time":"2023-12-30","value":0.05323820397638782}]}

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

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10-K
12/31/17

DCF

Discounted Cash Flow Valuation of Pilgrims Pride 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	$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

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth -12%

Earnings Stability 18%

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	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%

What is the average Net Margin?

The average Net Margin over the past 5 years is +2.23%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is -0.05%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +7.2%.

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

The trend of ROA over the past 5 years is -0.29%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is +11.81%.

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

The trend of ROE over the past 5 years is +0.26%.

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	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%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 5.71.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is 0.61.

What is the Graham’s Stability?

Graham’s Stability measure stands at 0.12.

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	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%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +9.68%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is +0.66%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is +5.44%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is +109.31%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +10.62%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is +2.27%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is -3.43%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is +2.4%.