Campbell Soup Co

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CPB : NYSE : Consumer Goods
$62.61 | %
Today's Range: 0.00 - 0.00
Avg. Daily Volume: 2,091,100
07/26/16 - 4:02 PM ET

Financial Analysis


CAMPBELL SOUP CO's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. CAMPBELL SOUP CO has very weak liquidity. Currently, the Quick Ratio is 0.43 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 4.94% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)1870.01900.0
EBITDA ($mil)336.0380.0
EBIT ($mil)260.0306.0
Net Income ($mil)185.0179.0


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)383.0230.0
Total Assets ($mil)8081.07759.0
Total Debt ($mil)3686.03785.0
Equity ($mil)1676.01597.0


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin39.3639.79
EBITDA Margin17.9620.0
Operating Margin13.916.11
Sales Turnover0.991.06
Return on Assets8.8110.13
Return on Equity42.4849.21
Debt Q3 FY16 Q3 FY15
Current Ratio0.860.82
Debt/Capital0.690.7
Interest Expense29.029.0
Interest Coverage8.9710.55


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)309.0311.0
Div / share0.310.31
EPS0.590.57
Book value / share5.425.14
Institutional Own % n/a n/a
Avg Daily Volume2025027.02016367.0

Valuation


BUY. This stock's P/E ratio indicates a significant discount compared to an average of 46.79 for the Food Products industry and a premium compared to the S&P 500 average of 25.05. For additional comparison, its price-to-book ratio of 11.68 indicates a significant premium versus the S&P 500 average of 2.81 and a significant premium versus the industry average of 6.02. The current price-to-sales ratio is well above the S&P 500 average, but below the industry average. The valuation analysis reveals that, CAMPBELL SOUP CO seems to be trading at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
CPB 27.78 Peers 46.79   CPB 14.02 Peers 18.09

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

CPB is trading at a significant discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

CPB is trading at a discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
CPB 20.17 Peers 23.49   CPB 0.81 Peers 1.23

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

CPB is trading at a valuation on par with its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

CPB trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
CPB 11.68 Peers 6.02   CPB -8.44 Peers 68.51

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

CPB is trading at a significant premium to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, CPB is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
CPB 2.46 Peers 2.53   CPB -3.33 Peers 144.88

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

CPB is trading at a valuation on par with its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

CPB significantly trails its peers on the basis of sales growth

 

 

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