NYSE:HRL
$41.40
(3/19 4:00PM)
-0.4%
| Open | $41.61 |
Mkt Cap | $5.5 Billion |
| High | $41.75 |
52Wk High | $42.68 |
| Low | $41.11 |
52Wk Low | $29.16 |
| Volume | 597,118 |
Avg Vol 10D | 488,400 |
HRL Revenue
Cash earnings is the most important factor in our analysis, but it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 10 years. For, HRL the high and low end of the Price to Sales per share ratios are 1.00x and 0.73x respectively.
Notice that HRL's current Price to Sales per share ratio is 0.84x, which is slightly under its historical average. This level of Price to Sales gives us a fairly neutral position on the HRL shares. We would like to see a drop in the Price to Sales ratio just a little bit more (given current sales figures) before we would become more positive on a Price to Sales basis. Such a drop would increase the attractiveness of the stock but, as always, would need to be considered in the context of all other valuation factors.
HRL Cash Earnings
Cash Earnings is always one of the most important factors to review for a company and, more importantly, an investment in a stock. HRL is below its historical average multiple of Cash Earnings. Looking at the last 10 years we can get a good understanding of what investors have grown to expect from HRL. For example, HRL's Cash Earnings ratio per share has fluctuated between 10.74 and 14.78 over this historical timeframe. This range is based upon a proprietary weighted methodology at Ockham, but can clearly show an investor where HRL is with respect to prior business periods.
So what does a Cash Earnings ratio below the historical norm mean for HRL? Generally, HRL's investors have paid slightly higher stock prices for this level of Cash Earnings, which bodes well as a return to historical norms is statistically likely. However, it is never a guarantee that history gives us proper direction, particularly in fluctuating market cycles. So by utilizing a long term view and incorporating other areas of analysis (like Sales, Dividends, and management analysis), each investor can gain a more complete view of HRL. Remember, that the average Cash Earnings level for HRL has been 12.76, so the current Cash Earnings level of 11.07 is a positive in our view, but by no means is it overwhelming.
HRL Dividends
While it is not necessary to pay an attractive dividend or a dividend at all, to receive a positive rating from Ockham, we view dividends as an additionally helpful measure in determining the future potential of any company.
In HRL’s case, the estimated annual dividend is $0.84 resulting in a current dividend yield of 2.03%. Similar to our review of Sales and Cash Earnings per share, we evaluate dividend yields from HRL against the historic high and low levels over the past 10 years. The highest dividend yield from HRL over this period was 3.07% while the lowest dividend yield was 1.04% Given this range, the current dividend yield for HRL is below its historical median and not terribly attractive from this perspective.
Zero Hedge Discussed HRL in Relation to M&A Activity
News broke today regarding mergers and acquisitions and Hormel Foods Corporation was discussed as well on Zero Hedge. Other sources will be required to know exactly what the context was in the discussion.
When looking at our entire coverage universe and ranking stocks by the attention they receive on RazorWire, it is clear that Hormel Foods Corporation has been talked about more than normal recently. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on HRL. The Motley Fool CAPS data suggests that investors believe Hormel Foods Corporation will beat the market in the foreseeable future.
“… HORMEL FOODS wants to expand in China with an acquisition or a joint venture. HP revises previously reported Q1 net lower by $73M due to litigation charge. …”
See Why Hormel Foods Corporation News Was Discussed on Squawk On The Street
Hormel Foods Corporation is one of the thousands of companies that Ockham has news analytics on, and it was recently discussed on Squawk On The Street.
The Motley Fool CAPS data suggests that investors believe Hormel Foods Corporation will beat the market in the foreseeable future. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on HRL. As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, HRL has been less covered in the news compared to the rest of our universe of stocks.
“… near and dear to our heart, tyson, HORMEL, sara lee, heinz, food stocks trading near one-year highs. > > quirky little thing that could have big implications for. …”
Check Out Squawk On The Street and News on HRL
Hormel Foods Corporation is one of the thousands of companies that Ockham has news analytics on, and it was recently discussed on Squawk On The Street.
Hormel Foods Corporation receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey. We noticed recently that in comparison to all other stocks we analyze in the news; HRL has received less coverage from the financial media in business television and blogs.
“… HORMEL almost at an all time could get through. If it does there you go. Has to get up around 46. 75. Fourth quarter results beat by a mile and the revenues were there and ... …”
HRL's Back in the News After More than a Month on Squawk On The Street
After a month of relative quiet from HRL, they have appeared back in the news.
The Ockham valuation currently has a Fairly Valued stance on HRL because it trades within the price range that we would expect given current market conditions and fundamentals. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Hormel Foods Corporation has actually sunk a bit in comparison to the others. We have recently (Saturday, January 30, 2010) downgraded this stock due to deteriorating fundamentals. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey.
“… Ceo and president and chairman of HORMEL. > > > next, wall street's payday. How much is a big bank ceo really worth? The answer especially as the list, the list of more than ... …”
Squawk On The Street: Get Plugged into HRL News Regarding The CEO
CEO's are the strategic leaders of their companies, so any mention of them will garner special interest from us.
The Ockham valuation currently has a Fairly Valued stance on HRL because it trades within the price range that we would expect given current market conditions and fundamentals. We have recently (Saturday, January 30, 2010) downgraded this stock due to deteriorating fundamentals. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Hormel Foods Corporation has actually sunk a bit in comparison to the others. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey.
“… HORMEL FOODS is a high flying stock over the past decade. And it's doubled over the past ten years. I'm curious. More recently over the past month though shares have been ... …”
Holding HRL Stock? See What Is Being Discussed on Street Signs
Staying informed on the news is invaluable for investors, and RazorWire has captured a recently discussion on HRL from Street Signs.
As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, HRL has been less covered in the news compared to the rest of our universe of stocks. The improving valuation of Hormel Foods Corporation has prompted us to upgrade this stock as of Saturday, November 14, 2009. The Motley Fool CAPS data suggests that investors believe Hormel Foods Corporation will beat the market in the foreseeable future. We consider HRL as Undervalued at the current price of $38.12. According to our methodology, this stock has appreciation potential based on current fundamentals which only improves if earnings or revenue surprise.
“… 6% for those of you out there that like brent's turkey trade, he also like HORMEL FOODS. > > > now, when we talk about who's been making money we all know a lot of big wigs on wa... …”
Dividends and Hormel Foods Corporation Among the Topics Covered on Closing Bell
Dividends are a management decision and can be seen as a signal of strength or weakness depending on the latest news. RazorWire captured a discussion of HRL's dividends recently on Closing Bell.
It is also notable that we have recently upgraded this stock on Saturday, November 14, 2009 because HRL is more attractive in many of the valuation metrics we evaluate. At present, Ockham has a valuation stance of Undervalued on HRL, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Hormel Foods Corporation has actually sunk a bit in comparison to the others.
“… HORMEL boosting the dividend by 10. 5%. Still on the downside for this day. Hj heinz and medtronic are to the plus sign. …”
More News Than Normal on HRL from Closing Bell
We are observing a lot of attention being paid to HRL in the news, so if you hold the stock you may want to take a look at what is going on.
Based on our methodology, Hormel Foods Corporation should hold some appeal to value investors as we view it as Undervalued. Please have a look at our report for our reasons to upgrade the stock to Undervalued on our report dated Saturday, November 14, 2009. We noticed recently that in comparison to all other stocks we analyze in the news; HRL has received less coverage from the financial media in business television and blogs. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey.
“… HORMEL is up. Giving a little bit back. Hj heinz and medtronic movers to the upside. The stock is up 6%. Retailers to talk about. Positive news, american eagle, dsw and j. …”
Blue Chips Move the Market: Fox Business Talks HRL
As leading economic indicators, blue chip stocks often receive a lot of attention from the media. Recently, Fox Business talked about HRL in their discussion of economic bellwethers.
The Motley Fool CAPS data suggests that investors believe Hormel Foods Corporation will beat the market in the foreseeable future. We consider HRL as Undervalued at the current price of $38.18. According to our methodology, this stock has appreciation potential based on current fundamentals which only improves if earnings or revenue surprise. The improving valuation of Hormel Foods Corporation has prompted us to upgrade this stock as of Saturday, November 14, 2009. As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, HRL has been less covered in the news compared to the rest of our universe of stocks.
“… A dow component up 11%. It hit a 52-week high. They hit 52-week highs with HORMEL with numbers but it's down after the 52-week high. A light run. Light volume. …”
Earnings Discussion for Hormel Foods Corporation on Power Lunch
Earnings are one of the most important fundamental factors we track, so we are always interested in the latest profit reports and news.
It is also notable that we have recently upgraded this stock on Saturday, November 14, 2009 because HRL is more attractive in many of the valuation metrics we evaluate. At present, Ockham has a valuation stance of Undervalued on HRL, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Hormel Foods Corporation has actually sunk a bit in comparison to the others. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey.
“… But otherwise, you see the -- HORMEL earnings came in above the stock is down, heinz higher and medtronic getting a lift. Let's head to the nasdaq and > > …”