Pilgrims Pride Corp (PPC) stock analysis

P/E above its 5-year median

Pilgrims Pride's P/E of 20.9 is above its own 5-year median of 11.6.

P/E below the industry

Pilgrims Pride's P/E of 20.9 is below the Food and Kindred Products median of 21.0.

EV/EBITDA above its 5-year median

Pilgrims Pride's EV/EBITDA of 8.3 is above its 5-year median of 7.0.

P/B below the industry

Pilgrims Pride's price-to-book of 1.73 is below the Food and Kindred Products median of 2.12.

Trading below fair value

The share price of $28.21 is below our fair value estimate of $33.89.

Margin of safety under 20%

The price is 16.8% below fair value, less than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew 1.9% a year over the last three fiscal years, short of the 10% we look for.

EPS growing 10%+ a year

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

Earnings growth not accelerating

Net income grew -74.0% over the last twelve months, against a 5-year average of 62.8% a year.

Growing slower than the industry

Revenue grew -0.1% over the last twelve months; the Food and Kindred Products median is 0.6%.

Company guidance

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

Gross margin slipping

Gross margin was 7.9% over the last twelve months, against 13.5% a year earlier.

Return on equity under 15%

Return on equity was 8.6% over the last twelve months and averaged 19.0% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 6.6%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

Pilgrims Pride's return on equity of 8.6% is above the Food and Kindred Products median of 6.2%.

Earnings grew over 5 years

Net income grew 62.8% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 1.7% over the last twelve months, against a 5-year average of 3.7%.

Net margin below the industry

Pilgrims Pride's net margin of 1.7% is below the Food and Kindred Products median of 2.3%.

High debt

Debt is 87.9% of shareholders' equity, above the 40% we consider low.

Debt falling against equity

Debt to equity fell from 89.0% five years ago to 87.9%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 28.6% of total debt.

Interest not well covered

Operating income covers interest expense 3.9 times; we look for at least 5.

Short-term assets cover short-term debts

Current assets are 1.55 times current liabilities.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.93; above 3 is the safe zone and below 1.8 the distress zone.

No dividend

Pilgrims Pride has not paid a dividend in the last twelve months.

Yield against Treasuries

No dividend.

Yield against the market

No dividend.

Dividend stability

No dividend.

Earnings cover

No dividend.

Cash-flow cover

No dividend.