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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Pricesmart, Inc. (XNAS:PSMT) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
PSMT
Name:
PRICESMART, INC. (XNAS:PSMT)
Sector:
- 43068.00K
Industry:
Discount Stores
CEO:
Ms. Sherry Bahrambeygui
Total Employees:
10,400
Our Technological Advancement Rating
Our Rating:
A
Technological advancement compared to industry is 56.99% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF PRICESMART, INC.(PSMT) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND DISCOUNT STORES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
61.68
One Month Price Target:
$61.92
Six Month Price Target :
$63.14
Likely Price in One Year's Time:
Ticker:
$64.6
Likely Trading Range Today Under (Normal Volatility)
$61.45
Price Upper limit ($) :
$61.91
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$58.89
This week:
$55.44
This month :
$49.21
Other Primary facts
Market Cap:
1.93B
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
30.93M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
12.2%
-13.76%
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:
$74.63
$68.74
$48.73
$54.62
Medium risk (<10%) entry points
Buy Call
Sell Call
$66.83
Buy Put:
Sell Put:
$65.57
$56.52
$57.79
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
PSMT
Sharpe Ratio:
-0.40%
Comparison:
PSMT, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is -117.19% lower than the industry
& is -117.48% lower than the market/S&P 500 average
Average Returns/Yield of
PSMT
Daily returns:
0.00%
Weekly returns:
0.00%
Monthly returns:
0.00%
Yearly returns:
13.35%
Comparison of returns:
Average annual returns/yield (last 3 years) is -99.87% below industry average
Classification:
PSMT, is amongst the top 40% lowest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.95
Statistical test of Returns:
PSMT has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.20%
Weekly Volatility:
4.92%
Monthly Volatility:
9.85%
Yearly Volatility:
34.11%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.39%
Volatility in last five trading days has been -82.08% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.52%
Weekly VaR:
-10.11%
Monthly VaR:
-20.22%
How Much Can the price of
PSMT
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-18%
Worst case (decline):
-70.05%
This translates to price declining to:
$50.65
This translates to price declining to:
$18.47
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
PSMT is a 42.72% riskier investment compared to the market/S&P 500 & is 22.27% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -1.11% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
PSMT
Beta in relation to market/S&P 500--0.70
Expected beta in 1 year's time:
0.693
Expected beta in 3 year's time:
0.98
Unlevered (debt free) Beta:
0.603
Beta in relation to Nasdaq (XNAS):
0.393
Beta in relation to all global stocks::
0.554
Beta Comparison & Analysis
Beta of competitors/peers::
0.742
Beta is -5.10% lower than peers
Average Industry Beta:
0.701
Beta is 0.44% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
8.47%
Sustainable growth rate is -56.42% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.080
Alpha is -247.38% below industry average alpha yield
Alpha is -506% below the market average
Analysis of Cost of Capital of
PSMT
Equity cost of capital:
0.080
Equity cost of capital is 0.27% above industry mean WACC
Unlevered (without debt) cost of capital:
6.83%
Before-tax cost of debt:
2.64%
After-tax cost of debt:
2.09%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.09%
WACC is 17.94% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$123.46
Revenue growth rate per share of (3Y):
2.03
Annual revenue growth rate is -61.62% below industry average
EPS:
$3.36
Expected Annual growth rate of EPS (3Y):
10.75%
Expected future EPS growth rate is -43.19% lower than the Discount Stores industry
Free cash flow (FCF) per share:
-
Balance sheet equity growth per share: 2.54%
Equity growth rate per share is -97.73% lower than the industry
Debt per share
$7.62
EBITDA per share
$7.36
Valuation Analysis Today of
PSMT
P/E Ratio:
18.96
P/E Ratio of Competitors/Peers:
23.98
P/E ratio is -20.94% lower than main peers & is -18.29% lower than the industry
Stock price/value with industry average P/E ratio: $77.94
PSMT is -20.87% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $122.90
Present value of the expected future dividends only: $69.11
P/S (Price to Sales ratio):
0.5
Price to sales ratio is -51.95% below the industry mean
P/B (Price to book value ratio):
2.03
-
Price to free cash flow ratio is 244.76% higher than the industry
Net income growth rate (3Y):
30.55%
Net income growth rate is -38.17% lower than the industry average net income growth rate
Dividend Analysis
-
Dividend yeild: 2.40%
Previous Dividend: $0.43
Previous adjusted dividend: $0.43
Previous Dividend: $1.48
Expected next dividend best case: $0.49
Expected next dividend worst case: $0.37
Average dividend payment (long-term): $0.37
Average dividend increase/decrease (growth rate) % per period: 5.71%
Expected next dividend payment date: 30/05/2022
Expected next dividend record date: 16/05/2022
Expected next dividend declaration date: 05/09/2022
Previous dividend payment date: 28/02/2022
Previous dividend record date: 15/02/2022
Previous dividend declaration date: 02/07/2022
Dividend History:
2022-02-14--$0.43
2021-02-11--$0.35
2020-02-13--$0.35
2021-08-12--$0.35
2020-08-13--$0.35
--$0.00
Dividend growth rate is -86.97% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
25.01%
Net debt to equity ratio:
9.36%
Debt to assets ratio:
13.17%
Net debt to assets ratio:
4.93%
Debt-to-asset ratio is -79.86% below industry average
Ability to repay debt:
Interest coverage ratio:
32.62
Interest coverage ratio is -87.60% less than industry average
Looking forward:
Debt growth rate:
-19.00%
Annual debt growth is -100% lower than industry average debt growth rate
Debt repayment rate in last quarter: 4.31%
Analysis of Key Statistics
Correlation of price movement with the market:
0.397
Statistical significance of correlation:
PSMT has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.493
Stock price is -19.51% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.493
Correlation of price movement with Nasdaq (^IXIC):
-0.028
Covariance of price movement with the market:
-0.036
Kurtosis
6.052
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:
0.049
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
PSMT
Gross Profit Margin Ratio:
70%
Operating Profit Margin Ratio:
4.26%
Operating profit margin is -16.47% lower than the industry
Net Profit Margin Ratio:
70%
Effective Tax Rate:
32.78%
Effective tax rate is 23.66% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
11.03%
Return on equity (ROE) is -54.32% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
5.81%
Return on assets (ROA) is -25.23% lower than the industry
Financial Leverage:
1.2x
Current Ratio:
1.32
Current ratio is 0.53% above industry average
Cash Conversion Cycle (days):
-38.7
Cash conversion cycle is -177.10% below industry average
The remaining useful life of property plant & equipment is: 6.2 years
Stock based compensation to net income ratio:
4.39%
In-depth Efficiency Analysis
Revenue generated per employee:
367.2K
Each employee generates -2% less revenue than industry average revenue per employee
EBITDA generated per employee:
21.9K
Each employee generates -19% less EBITDA than industry average revenue per employee
Profit generated per employee:
10.0K
Each employee generates -35% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 4.1K
Each employee generates -487% less free cash flow than industry average revenue per employee
Assets/Capital per employee
96.8K
Each employee generates -487% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
PSMT
LAUREATE EDUCATION, INC. (XNAS:LAUR)
COCA-COLA CONSOLIDATED, INC. (XNAS:COKE)
2U, INC. (XNAS:TWOU)
CENTRAL GARDEN & PET COMPANY (XNAS:CENT)
CENTRAL GARDEN & PET COMPANY (XNAS:CENTA)
INTER PARFUMS, INC. (XNAS:IPAR)
J & J SNACK FOODS CORP. (XNAS:JJSF)
THE SIMPLY GOOD FOODS COMPANY (XNAS:SMPL)
HOSTESS BRANDS, INC. (XNAS:TWNK)
Current Analyst Ratings
Strong buy�0%
Buy�4%
Hold�8%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
2/28/22
Revenue:
3.82B
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:
3.15B
667.10M
-
501.40M
501.40M
-
1.30M
502.70M
2.11M
6.98M
65.92M
227.60M
162.85M
103.96M
154.81M
50.74M
103.96M
Statement of Cash Flow
Date:
Period:
15.60M
Differed Income Tax :
654.00K
Stock Based Compensation :
4.57M
Change in Working Capital :
- 65116.00K
Accounts Receivables:
-
Other Working Capital:
- 27108.00K
Other Non-Cash Items:
442.00K
Net Cash Provided by Operating Activities:
- 13339.00K
Investments in PP&E:
- 29729.00K
Net Acquisitions:
-
Purchases of Investments:
- 4310.00K
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):
11/30/21
2022
Q1
176.07M
39.20M
215.27M
15.57M
500.77M
50.80M
782.42M
850.97M
43.33M
1.92M
10.53M
23.92M
76.21M
1.01B
-
1.79B
461.05M
28.60M
6.96M
28.13M
76.38M
594.15M
235.65M
15.74M
253.01M
-
847.17M
3.00K
689.43M
- 188639.0K
-
November 30, 2021 at 12:00:00 AM
3.65B
942.15M
1.79B
49.74M
264.25M
88.2M
16.97M
5.02M
- 12050.00K
- 10614.00K
-
- 2433.00K
-
14.25M
1.20M
1.31M
- 22879.00K
192.60M
215.48M
- 13339.00K
- 29729.00K
- 43068.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
PSMT
2023
2024
2025
2026
2027
$80.31
$84.11
$88.09
$92.26
$96.63