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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
The Chefs' Warehouse, Inc. (XNAS:CHEF) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
CHEF
Name:
THE CHEFS' WAREHOUSE, INC. (XNAS:CHEF)
Sector:
- 3923.00K
Industry:
Food Distribution
CEO:
Mr. Christopher Pappas
Total Employees:
2,712
Our Technological Advancement Rating
Our Rating:
A
Technological advancement compared to industry is 265.18% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF THE CHEFS' WAREHOUSE, INC.(CHEF) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND FOOD DISTRIBUTION INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
32.35
One Month Price Target:
$32.65
Six Month Price Target :
$34.17
Likely Price in One Year's Time:
Ticker:
$35.99
Likely Trading Range Today Under (Normal Volatility)
$32.08
Price Upper limit ($) :
$32.73
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$28.5
This week:
$23.74
This month :
$15.13
Other Primary facts
Market Cap:
1.27B
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
38.26M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
55.21%
-53.06%
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:
$50.21
$41.97
$14.49
$22.73
Medium risk (<10%) entry points
Buy Call
Sell Call
$39.29
Buy Put:
Sell Put:
$37.53
$25.39
$27.17
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
CHEF
Sharpe Ratio:
2.72%
Comparison:
CHEF, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 6.74% higher than the industry
& ratio is 19.20% higher than the market/S&P 500 average
Average Returns/Yield of
CHEF
Daily returns:
0.17%
Weekly returns:
0.84%
Monthly returns:
3.37%
Yearly returns:
25.81%
Comparison of returns:
Average annual returns/yield (last 3 years) is 56.75% above industry average
Classification:
CHEF, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.26
Statistical test of Returns:
CHEF has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
5.88%
Weekly Volatility:
13.15%
Monthly Volatility:
26.29%
Yearly Volatility:
91.07%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.11%
Volatility in last five trading days has been -81.16% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-11.90%
Weekly VaR:
-26.62%
Monthly VaR:
-53.24%
How Much Can the price of
CHEF
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-45%
Worst case (decline):
>85%
This translates to price declining to:
$17.75
This translates to price declining to:
$4.85
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
CHEF is a 275.76% riskier investment compared to the market/S&P 500 & is 221.91% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 50.40% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
CHEF
Beta in relation to market/S&P 500--1.67
Expected beta in 1 year's time:
0.873
Expected beta in 3 year's time:
1.235
Unlevered (debt free) Beta:
0.802
Beta in relation to Nasdaq (XNAS):
1.114
Beta in relation to all global stocks::
1.544
Beta Comparison & Analysis
Beta of competitors/peers::
0.767
Beta is 118.25% higher than peers
Average Industry Beta:
1.088
Beta is 53.96% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
0.258
Alpha is 69.87% above industry average alpha yield
Alpha is 1644% higher than market/& is unsustainably high
Analysis of Cost of Capital of
CHEF
Equity cost of capital:
0.146
Equity cost of capital is 37.93% above industry mean WACC
Unlevered (without debt) cost of capital:
7.00%
Before-tax cost of debt:
3.07%
After-tax cost of debt:
2.42%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.42%
WACC is 15.51% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$51.69
Revenue growth rate per share of (3Y):
3.49
Annual revenue growth rate is -94.45% below industry average
EPS:
$0.39
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
-
-
-
Debt per share
$14.05
EBITDA per share
$1.90
Valuation Analysis Today of
CHEF
P/E Ratio:
42.48
P/E Ratio of Competitors/Peers:
27.44
P/E ratio is 54.79% higher than main peers & is 25.12% higher than the industry
Stock price/value with industry average P/E ratio: $13.24
CHEF is 144.31% overvalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
0.63
Price to sales ratio is 60.83% above the industry mean
P/B (Price to book value ratio):
3.49
-
-
Net income growth rate (3Y):
-120.54%
Net income growth rate is 27.33% higher than the average industry net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
151.62%
Net debt to equity ratio:
135.64%
Debt to assets ratio:
49.23%
Net debt to assets ratio:
44.04%
Debt-to-asset ratio is -24.15% below industry average
Ability to repay debt:
Interest coverage ratio:
4.23
Interest coverage ratio is 47.29% more than industry average
Looking forward:
Debt growth rate:
0.00%
-
Debt repayment rate in last quarter: 0.26%
Analysis of Key Statistics
Correlation of price movement with the market:
0.435
Statistical significance of correlation:
CHEF has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.422
Stock price is 3.03% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.422
Correlation of price movement with Nasdaq (^IXIC):
0
Covariance of price movement with the market:
0
Kurtosis
30.963
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
0.409
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
CHEF
Gross Profit Margin Ratio:
91%
Operating Profit Margin Ratio:
1.88%
Operating profit margin is 235.46% higher than the industry
Net Profit Margin Ratio:
91%
Effective Tax Rate:
28.14%
Effective tax rate is 29.72% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
4.06%
Return on equity (ROE) is -71.77% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.32%
Return on assets (ROA) is -27.82% lower than the industry
Financial Leverage:
2.0x
Current Ratio:
2.26
Current ratio is 39.80% above industry average
Cash Conversion Cycle (days):
13.8
Cash conversion cycle is -39.81% below industry average
The remaining useful life of property plant & equipment is: 17.6 years
Stock based compensation to net income ratio:
21.16%
In-depth Efficiency Analysis
Revenue generated per employee:
729.2K
Each employee generates -63% less revenue than industry average revenue per employee
EBITDA generated per employee:
26.8K
Each employee generates -49% less EBITDA than industry average revenue per employee
Profit generated per employee:
5.3K
Each employee generates -64% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 1.4K
Each employee generates -98% less free cash flow than industry average revenue per employee
Assets/Capital per employee
240.7K
Each employee generates -98% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
CHEF
Tattooed Chef, Inc. (XNAS:TTCF)
Afya Limited (XNAS:AFYA)
THE ANDERSONS, INC. (XNAS:ANDE)
MISSION PRODUCE, INC. (XNAS:AVO)
JOHN B. SANFILIPPO & SON, INC. (XNAS:JBSS)
ARKO Corp. (XNAS:ARKO)
2U, INC. (XNAS:TWOU)
Strategic Education, Inc. (XNAS:STRA)
EUROPEAN WAX CENTER, INC. (XNAS:EWCZ)
Current Analyst Ratings
Strong buy�8%
Buy�8%
Hold�8%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
3/25/22
Revenue:
1.98B
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:
1.53B
449.05M
-
-
409.09M
-
2.76M
411.85M
-
17.19M
35.56M
72.77M
37.20M
14.38M
20.01M
5.63M
14.38M
Statement of Cash Flow
Date:
Period:
9.25M
Differed Income Tax :
504.00K
Stock Based Compensation :
3.04M
Change in Working Capital :
- 5373.00K
Accounts Receivables:
10.08M
Other Working Capital:
- 156.00K
Other Non-Cash Items:
1.48M
Net Cash Provided by Operating Activities:
10.28M
Investments in PP&E:
-
Net Acquisitions:
- 28000.00K
Purchases of Investments:
-
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):
3/25/22
2022
Q1
79.44M
-
79.44M
169.79M
152.44M
37.00M
438.68M
300.13M
230.99M
108.83M
-
8.88M
4.07M
652.89M
-
1.09B
121.44M
22.81M
-
-
49.92M
194.17M
537.39M
5.58M
542.97M
-
737.14M
383.00K
39.00M
- 1897.0K
316.94M
March 25, 2022 at 6:00:00 AM
1.94B
354.43M
1.09B
-
560.20M
480.8M
-
- 14206.00K
- 42206.00K
- 1405.00K
-
- 2040.00K
-
- 406.00K
- 3851.00K
58.00K
- 35716.00K
79.44M
115.16M
10.28M
- 14206.00K
- 3923.00K
Our Proprietary Portfolio Rating
Our Rating:
B
Price Forecast/Expected Price in Next 5 Years of
CHEF
2023
2024
2025
2026
2027
$29.31
$32.61
$36.28
$40.36
$44.91