Coffee Holding Co Inc (JVA) stock analysis

P/E below its 5-year median

Coffee's P/E of 6.0 is below its own 5-year median of 15.6.

P/E below the industry

Coffee's P/E of 6.0 is below the Food and Kindred Products median of 21.0.

EV/EBITDA below its 5-year median

Coffee's EV/EBITDA of 3.9 is below its 5-year median of 6.9.

P/B below the industry

Coffee's price-to-book of 0.92 is below the Food and Kindred Products median of 2.12.

Trading below fair value

The share price of $5.02 is below our fair value estimate of $13.13.

Margin of safety over 20%

The price is 61.8% below fair value, more than the 20% cushion we look for.

Revenue growing 10%+ a year

Revenue grew 13.6% a year over the last three fiscal years.

EPS growth over 3 years

Needs positive EPS three years ago and today.

Earnings acceleration

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

Growing faster than the industry

Revenue grew 8.2% over the last twelve months; the Food and Kindred Products median is 2.7%.

Company guidance

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

Gross margin improving

Gross margin was 19.9% over the last twelve months, against 18.6% a year earlier.

Return on equity under 15%

Return on equity was 16.3% over the last twelve months and averaged 0.2% over five years; we look for 15% on both.

Return on capital over 10%

Return on invested capital was 18.2%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Coffee's return on equity of 16.3% is above the Food and Kindred Products median of 6.6%.

Earnings over 5 years

Needs positive net income five years ago and in the latest year.

Net margin above its 5-year average

Net margin was 4.9% over the last twelve months, against a 5-year average of -0.1%.

Net margin above the industry

Coffee's net margin of 4.9% is above the Food and Kindred Products median of 2.7%.

Debt level

Needs debt and equity figures.

Debt trend

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

Debt coverage

Needs operating cash flow.

Interest well covered

Operating income covers interest expense 24.0 times.

Short-term assets cover short-term debts

Current assets are 4.14 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 6.11; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Coffee paid dividends worth 1.6% of the share price over the last twelve months.

Yield below Treasuries

The 1.6% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Coffee yields 1.6%.

Dividend stability

Fewer than five years of dividend history.

Earnings cover

Needs dividends paid and net income.

Cash-flow cover

Needs dividends paid and free cash flow.