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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Kellogg Company (XNYS:K) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
K
Name:
KELLOGG COMPANY (XNYS:K)
Sector:
189.00M
Industry:
Packaged Foods
CEO:
Mr. Steven Cahillane
Total Employees:
31,000
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -149.89% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF KELLOGG COMPANY(K) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND PACKAGED FOODS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
72.7
One Month Price Target:
$72.88
Six Month Price Target :
$73.76
Likely Price in One Year's Time:
Ticker:
$74.82
Likely Trading Range Today Under (Normal Volatility)
$72.53
Price Upper limit ($) :
$72.91
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$70.39
This week:
$67.54
This month :
$62.38
Other Primary facts
Market Cap:
24.58B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
340.11M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
10.65%
-10.92%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$83.41
$78.50
$61.99
$66.90
Medium risk (<10%) entry points
Buy Call
Sell Call
$76.90
Buy Put:
Sell Put:
$75.85
$68.49
$69.55
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
K
Sharpe Ratio:
1.10%
Comparison:
K, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -16.40% lower than the industry
& is -51.93% lower than the market/S&P 500 average
Average Returns/Yield of
K
Daily returns:
0.03%
Weekly returns:
0.13%
Monthly returns:
0.52%
Yearly returns:
8.42%
Comparison of returns:
Average annual returns/yield (last 3 years) is -26.10% below industry average
Classification:
K, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.54
Statistical test of Returns:
K has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
1.56%
Weekly Volatility:
3.48%
Monthly Volatility:
6.97%
Yearly Volatility:
24.14%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.94%
Volatility in last five trading days has been -39.67% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-3.17%
Weekly VaR:
-7.10%
Monthly VaR:
-14.20%
How Much Can the price of
K
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-12%
Worst case (decline):
-49.18%
This translates to price declining to:
$63.79
This translates to price declining to:
$36.94
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
K is a 0.21% riskier investment compared to the market/S&P 500 & is -14.15% less risky than Nasdaq(IXIC)
Risk (measured by volatility) is -31.87% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
K
Beta in relation to market/S&P 500--0.43
Expected beta in 1 year's time:
0.669
Expected beta in 3 year's time:
0.947
Unlevered (debt free) Beta:
0.188
Beta in relation to Nasdaq (XNAS):
0.187
Beta in relation to all global stocks::
0.352
Beta Comparison & Analysis
Beta of competitors/peers::
0.484
Beta is -10.44% lower than peers
Average Industry Beta:
0.586
Beta is -25.96% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
19.76%
Sustainable growth rate is 118.17% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.001
Alpha is -92.05% below industry average alpha yield
Alpha is 6% compared to market & is healthy
Analysis of Cost of Capital of
K
Equity cost of capital:
0.061
Equity cost of capital is -14.55% below industry mean WACC
Unlevered (without debt) cost of capital:
2.65%
Before-tax cost of debt:
2.77%
After-tax cost of debt:
2.19%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.19%
WACC is -21.51% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$41.95
Revenue growth rate per share of (3Y):
5.76
Annual revenue growth rate is -77.65% below industry average
EPS:
$4.49
Expected Annual growth rate of EPS (3Y):
15.50%
Expected future EPS growth rate is -14.05% lower than the Packaged Foods industry
Free cash flow (FCF) per share:
$3.72
Balance sheet equity growth per share: 7.06%
Equity growth rate per share is 45.33% higher than the industry
Debt per share
$19.08
EBITDA per share
$7.63
Valuation Analysis Today of
K
P/E Ratio:
16.77
P/E Ratio of Competitors/Peers:
22.02
P/E ratio is -23.85% lower than main peers & is -56.60% lower than the industry
Stock price/value with industry average P/E ratio: $173.49
K is -58.10% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $61.52
Present value of the expected future dividends only: $39.12
P/S (Price to Sales ratio):
1.73
Price to sales ratio is -25.28% below the industry mean
P/B (Price to book value ratio):
5.76
Price to free cash flow: 19.56
Price to free cash flow ratio is -61.76% lower than the industry
Net income growth rate (3Y):
0.52%
Net income growth rate is -95.19% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 12.78%
Dividend yeild: 3.19%
Previous Dividend: $0.58
Previous adjusted dividend: $0.58
Previous Dividend: $2.32
Expected next dividend best case: $0.58
Expected next dividend worst case: $0.58
Average dividend payment (long-term): $0.57
Average dividend increase/decrease (growth rate) % per period: 0.18%
Expected next dividend payment date: 13/09/2022
Expected next dividend record date: 30/08/2022
-
Previous dividend payment date: 15/06/2022
Previous dividend record date: 06/01/2022
-
Dividend History:
2022-05-31--$0.58
2021-11-30--$0.58
2021-05-28--$0.58
2022-02-28--$0.58
2021-08-31--$0.58
2021-03-01--$0.57
Dividend growth rate is -149.65% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
170.99%
Net debt to equity ratio:
201.34%
Debt to assets ratio:
34.86%
Net debt to assets ratio:
41.05%
Debt-to-asset ratio is -35.31% below industry average
Ability to repay debt:
Interest coverage ratio:
11.79
Interest coverage ratio is -95.22% less than industry average
Looking forward:
Debt growth rate:
-5.53%
Annual debt growth is -102% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.38%
Analysis of Key Statistics
Correlation of price movement with the market:
0.344
Statistical significance of correlation:
K has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.429
Stock price is -19.81% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.429
Correlation of price movement with Nasdaq (^IXIC):
0.031
Covariance of price movement with the market:
0.028
Kurtosis
11.8
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.272
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
K
Gross Profit Margin Ratio:
128%
Operating Profit Margin Ratio:
12.59%
Operating profit margin is 160.91% higher than the industry
Net Profit Margin Ratio:
128%
Effective Tax Rate:
23.63%
Effective tax rate is -42.04% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
40.63%
Return on equity (ROE) is 267.82% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
8.28%
Return on assets (ROA) is 85.52% higher than the industry
Financial Leverage:
1.5x
Current Ratio:
0.65
Current ratio is -76.21% below industry average
Cash Conversion Cycle (days):
-46.2
Cash conversion cycle is -194.11% below industry average
The remaining useful life of property plant & equipment is: 6.9 years
Stock based compensation to net income ratio:
1.04%
In-depth Efficiency Analysis
Revenue generated per employee:
460.3K
Each employee generates -42% less revenue than industry average revenue per employee
EBITDA generated per employee:
83.7K
Each employee generates -26% less EBITDA than industry average revenue per employee
Profit generated per employee:
49.7K
Each employee generates -5% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
6.1K
Each employee generates -264% less free cash flow than industry average revenue per employee
Assets/Capital per employee
477.3K
Each employee generates -264% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- -100.00%
Growth rate in R&D investment/expenditure is -2159.65% lower than the industry
Competitors/Peer firms of
K
THE CLOROX COMPANY (XNYS:CLX)
MCCORMICK & COMPANY, INCORPORATED (XNYS:MKC)
MCCORMICK & COMPANY, INCORPORATED (XNYS:MKC)
COCA-COLA EUROPACIFIC PARTNERS PLC (XNAS:CCEP)
HORMEL FOODS CORPORATION (XNYS:HRL)
Mexican Economic Development, Inc. (XNYS:FMX)
CONAGRA BRANDS, INC. (XNYS:CAG)
THE J. M. SMUCKER COMPANY (XNYS:SJM)
ALBERTSONS COMPANIES, INC. (XNYS:ACI)
Current Analyst Ratings
Strong buy�8%
Buy�4%
Hold�63%
Sell�8%
Strong sell�4%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
4/2/22
Revenue:
14.27B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
9.72B
4.55B
-
-
2.76B
-
-
2.76B
-
220.00M
355.00M
2.59B
1.80B
1.54B
2.02B
477.00M
1.54B
Statement of Cash Flow
Date:
Period:
119.00M
Differed Income Tax :
42.00M
Stock Based Compensation :
16.00M
Change in Working Capital :
- 222000.00K
Accounts Receivables:
- 184000.00K
Other Working Capital:
- 85000.00K
Other Non-Cash Items:
- 52000.00K
Net Cash Provided by Operating Activities:
327.00M
Investments in PP&E:
- 138000.00K
Net Acquisitions:
-
Purchases of Investments:
- 2000.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
4/2/22
2022
Q1
313.00M
-
313.00M
1.69B
1.56B
257.00M
3.82B
4.45B
5.78B
2.41B
425.00M
-
1.73B
14.80B
-
18.61B
2.71B
1.47B
-
-
1.68B
5.85B
6.49B
1.17B
8.47B
-
14.32B
105.00M
9.25B
- 1611000.0K
- 3953000.00K
April 2, 2022 at 6:00:00 AM
12.47B
3.80B
18.11B
-
7.95B
7.6B
1.00M
27.00M
- 112000.00K
- 25000.00K
40.00M
- 300000.00K
- 197000.00K
311.00M
- 171000.00K
- 17000.00K
27.00M
313.00M
286.00M
327.00M
- 138000.00K
189.00M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
K
2023
2024
2025
2026
2027
$97.06
$99.89
$102.80
$105.80
$108.88