NEW YORK (TheStreet) -- Hain Celestial Group (HAIN - Get Report) stock closed up by 4.26% to $40.62 on heavy trading volume on Wednesday, after it was initiated with a "buy" rating and a $50 price target at Jefferies earlier today.
"We view Hain Celestial as having one of the strongest growth profiles among U.S. packaged food companies due to its exposure to the fast-growing non-GMO and organic industries," Jefferies said in an analyst note.
About 99% of the company's products are non-GMO, while 40% of them are organic.
Non-GMO and organic foods account for 3% and 2% of total food sales, respectively, which shows the categories have "strong long-term growth potential," analysts added.
Hain Celestial can gain from segment growth through its existing brands, such as Terra Chips, Celestial Seasonings and Arrowhead Mills, as well as through new acquisitions, analysts noted.
By the end of the trading day, 2.54 million shares of Hain Celestial had exchanged hands, compared with its average daily volume of 1.9 million shares.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate HAIN CELESTIAL GROUP INC as a Buy with a ratings score of B-. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, reasonable valuation levels and good cash flow from operations. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- HAIN's revenue growth has slightly outpaced the industry average of 2.3%. Since the same quarter one year prior, revenues slightly increased by 6.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The current debt-to-equity ratio, 0.50, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.27, which illustrates the ability to avoid short-term cash problems.
- HAIN CELESTIAL GROUP INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, HAIN CELESTIAL GROUP INC increased its bottom line by earning $1.62 versus $1.42 in the prior year. This year, the market expects an improvement in earnings ($2.14 versus $1.62).
- Net operating cash flow has significantly increased by 121.30% to $5.79 million when compared to the same quarter last year. In addition, HAIN CELESTIAL GROUP INC has also vastly surpassed the industry average cash flow growth rate of -20.38%.
- You can view the full analysis from the report here: HAIN