J M SMUCKER Co (SJM) stock analysis

P/E against its history

Not enough price and earnings history to compare.

P/E against the industry

Needs positive earnings and enough profitable companies in the industry.

EV/EBITDA above its 5-year median

J M Smucker's EV/EBITDA of 25.3 is above its 5-year median of 21.5.

P/B above the industry

J M Smucker's price-to-book of 2.47 is above the Food and Kindred Products median of 2.12.

Trading above fair value

The share price of $133.07 is above our fair value estimate of $87.89.

Margin of safety under 20%

The price is 51.4% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 2.0% a year over the last three fiscal years, short of the 10% we look for.

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 5.1% over the last twelve months; the Food and Kindred Products median is 2.6%.

Guidance raised

J M Smucker raised its fiscal 2027 net sales outlook on Aug 26, 2026.

Gross margin improving

Gross margin was 38.7% over the last twelve months, against 35.1% a year earlier.

Return on equity under 15%

Return on equity was 3.9% over the last twelve months and averaged -0.7% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 3.4%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

J M Smucker's return on equity of 3.9% is above the Food and Kindred Products median of -2.5%.

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 2.5% over the last twelve months, against a 5-year average of 0.1%.

Net margin above the industry

J M Smucker's net margin of 2.5% is above the Food and Kindred Products median of -5.7%.

High debt

Debt is 117% of shareholders' equity, above the 40% we consider low.

Debt rising against equity

Debt to equity rose from 58.5% five years ago to 117%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 28.3% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets don't cover short-term debts

Current assets are 0.87 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 1.54; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

J M Smucker paid dividends worth 3.3% of the share price over the last twelve months.

Yield below Treasuries

The 3.3% 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; J M Smucker yields 3.3%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Not covered by earnings

Dividends take 204% of net income, leaving little room.

Covered by free cash flow

Dividends take 29.4% of free cash flow.