Cal-Maine Foods Inc (CALM) stock analysis

P/E above its 5-year median

Cal-Maine Foods's P/E of 56.8 is above its own 5-year median of 6.2.

P/E above the industry

Cal-Maine Foods's P/E of 56.8 is above the Consumer staples median of 24.1.

EV/EBITDA above its 5-year median

Cal-Maine Foods's EV/EBITDA of 16.0 is above its 5-year median of 3.8.

P/B below the industry

Cal-Maine Foods's price-to-book of 1.21 is below the Consumer staples median of 2.23.

Trading below fair value

The share price of $66.45 is below our fair value estimate of $88.06.

Margin of safety over 20%

The price is 24.5% below fair value, more than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew -2.5% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -24.7% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew -95.4% over the last twelve months, against a 5-year average of 174% a year.

Growing slower than the industry

Revenue grew -42.5% over the last twelve months; the Consumer staples median is 3.7%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin slipping

Gross margin was 14.3% over the last twelve months, against 43.5% a year earlier.

Return on equity under 15%

Return on equity was 2.2% over the last twelve months and averaged 30.6% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 1.0%, below the 10% that usually covers the cost of capital.

Return on equity below the industry

Cal-Maine Foods's return on equity of 2.2% is below the Consumer staples median of 5.3%.

Earnings grew over 5 years

Net income grew 174% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 2.3% over the last twelve months, against a 5-year average of 16.6%.

Net margin above the industry

Cal-Maine Foods's net margin of 2.3% is above the Consumer staples median of 2.0%.

No debt

Cal-Maine Foods has no borrowings on its latest balance sheet.

Debt not rising

With no debt today, leverage cannot have risen.

Debt covered by cash flow

There is no debt to cover.

Interest well covered

No meaningful interest expense to cover.

Short-term assets cover short-term debts

Current assets are 7.70 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 6.92; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Cal-Maine Foods paid dividends worth 1.6% of the share price over the last twelve months.

Yield below Treasuries

The 1.6% yield is below the 4.7% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Cal-Maine Foods yields 1.6%.

Dividend was cut

The dividend per share fell by more than 10% at least once in the last 10 fiscal years.

Not covered by earnings

Dividends take 200% of net income, leaving little room.

Cash-flow cover

Needs dividends paid and free cash flow.