Crown Crafts Inc (CRWS) stock analysis

P/E below its 5-year median

Crown Crafts's P/E of 5.3 is below its own 5-year median of 9.9.

P/E below the industry

Crown Crafts's P/E of 5.3 is below the Consumer discretionary median of 19.6.

EV/EBITDA below its 5-year median

Crown Crafts's EV/EBITDA of 7.1 is below its 5-year median of 8.6.

P/B below the industry

Crown Crafts's price-to-book of 0.66 is below the Consumer discretionary median of 2.00.

Trading below fair value

The share price of $2.47 is below our fair value estimate of $5.97.

Margin of safety over 20%

The price is 58.6% below fair value, more than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew 3.1% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -32.8% a year over the last three fiscal years.

Earnings acceleration

Needs positive net income now, a year ago and five years ago.

Growing slower than the industry

Revenue grew -3.4% over the last twelve months; the Consumer discretionary median is 4.8%.

Company guidance

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

Gross margin improving

Gross margin was 29.4% over the last twelve months, against 24.1% a year earlier.

Return on equity under 15%

Return on equity was 12.8% over the last twelve months and averaged 5.7% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 7.4%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

Crown Crafts's return on equity of 12.8% is above the Consumer discretionary median of 5.6%.

Earnings shrank over 5 years

Net income shrank 21.2% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 6.0% over the last twelve months, against a 5-year average of 3.2%.

Net margin above the industry

Crown Crafts's net margin of 6.0% is above the Consumer discretionary median of 1.4%.

Low debt

Debt is 23.8% of shareholders' equity, under the 40% we consider low.

Debt trend

Needs a balance sheet from five years ago with positive equity.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 89.0% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets cover short-term debts

Current assets are 3.20 times current liabilities.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.52; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Crown Crafts paid dividends worth 10.9% of the share price over the last twelve months.

Yield above Treasuries

The 10.9% yield is above the 4.4% on a 1-year Treasury.

Yield in the top quarter

The top quarter of US dividend payers yield 3.8% or more; Crown Crafts yields 10.9%.

Dividend was cut

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

Covered by earnings

Dividends take 66.4% of net income.

Covered by free cash flow

Dividends take 43.8% of free cash flow.