Intrinsic value of John B. Sanfilippo & Son, Inc. - JBSS

Previous Close

$79.40

  Intrinsic Value

$52.52

stock screener

  Rating & Target

sell

-34%

Previous close

$79.40

 
Intrinsic value

$52.52

 
Up/down potential

-34%

 
Rating

sell

We calculate the intrinsic value of JBSS stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 0.9

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  907
  928
  951
  978
  1,008
  1,040
  1,076
  1,114
  1,156
  1,200
  1,247
  1,298
  1,352
  1,409
  1,470
  1,534
  1,603
  1,675
  1,751
  1,831
  1,916
  2,006
  2,100
  2,199
  2,304
  2,414
  2,530
  2,653
  2,781
  2,916
Variable operating expenses, $m
  841
  860
  882
  907
  934
  963
  996
  1,031
  1,069
  1,109
  1,140
  1,186
  1,236
  1,288
  1,343
  1,402
  1,465
  1,531
  1,600
  1,674
  1,751
  1,833
  1,919
  2,010
  2,106
  2,207
  2,313
  2,424
  2,542
  2,665
Fixed operating expenses, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  841
  860
  882
  907
  934
  963
  996
  1,031
  1,069
  1,109
  1,140
  1,186
  1,236
  1,288
  1,343
  1,402
  1,465
  1,531
  1,600
  1,674
  1,751
  1,833
  1,919
  2,010
  2,106
  2,207
  2,313
  2,424
  2,542
  2,665
Operating income, $m
  66
  67
  69
  72
  74
  77
  80
  83
  87
  91
  107
  112
  116
  121
  127
  132
  138
  144
  151
  158
  165
  173
  181
  189
  198
  208
  218
  228
  239
  251
EBITDA, $m
  93
  95
  98
  100
  103
  107
  110
  114
  119
  123
  128
  133
  139
  145
  151
  157
  164
  172
  180
  188
  197
  206
  215
  226
  236
  248
  260
  272
  285
  299
Interest expense (income), $m
  3
  4
  4
  4
  4
  5
  5
  5
  6
  6
  7
  7
  8
  8
  9
  9
  10
  11
  11
  12
  13
  14
  15
  16
  17
  18
  19
  20
  21
  23
  24
Earnings before tax, $m
  62
  63
  65
  67
  70
  72
  75
  78
  81
  84
  100
  104
  108
  113
  117
  122
  127
  133
  139
  145
  151
  158
  165
  173
  181
  189
  198
  207
  217
  227
Tax expense, $m
  17
  17
  18
  18
  19
  19
  20
  21
  22
  23
  27
  28
  29
  30
  32
  33
  34
  36
  37
  39
  41
  43
  45
  47
  49
  51
  53
  56
  59
  61
Net income, $m
  45
  46
  48
  49
  51
  53
  55
  57
  59
  61
  73
  76
  79
  82
  86
  89
  93
  97
  101
  106
  110
  115
  120
  126
  132
  138
  144
  151
  158
  166

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  424
  434
  445
  458
  471
  487
  503
  521
  540
  561
  583
  607
  632
  659
  688
  718
  750
  783
  819
  857
  896
  938
  982
  1,029
  1,078
  1,129
  1,184
  1,241
  1,301
  1,364
Adjusted assets (=assets-cash), $m
  424
  434
  445
  458
  471
  487
  503
  521
  540
  561
  583
  607
  632
  659
  688
  718
  750
  783
  819
  857
  896
  938
  982
  1,029
  1,078
  1,129
  1,184
  1,241
  1,301
  1,364
Revenue / Adjusted assets
  2.139
  2.138
  2.137
  2.135
  2.140
  2.136
  2.139
  2.138
  2.141
  2.139
  2.139
  2.138
  2.139
  2.138
  2.137
  2.136
  2.137
  2.139
  2.138
  2.137
  2.138
  2.139
  2.138
  2.137
  2.137
  2.138
  2.137
  2.138
  2.138
  2.138
Average production assets, $m
  135
  138
  142
  146
  150
  155
  160
  166
  172
  179
  186
  193
  201
  210
  219
  229
  239
  250
  261
  273
  286
  299
  313
  328
  343
  360
  377
  395
  414
  435
Working capital, $m
  173
  177
  182
  187
  193
  199
  205
  213
  221
  229
  238
  248
  258
  269
  281
  293
  306
  320
  334
  350
  366
  383
  401
  420
  440
  461
  483
  507
  531
  557
Total debt, $m
  71
  76
  80
  85
  91
  97
  104
  112
  120
  128
  138
  148
  158
  169
  181
  194
  207
  221
  236
  251
  268
  285
  304
  323
  343
  365
  387
  411
  436
  462
Total liabilities, $m
  176
  180
  185
  190
  196
  202
  209
  217
  225
  233
  243
  253
  263
  274
  286
  299
  312
  326
  341
  356
  373
  390
  409
  428
  448
  470
  492
  516
  541
  567
Total equity, $m
  248
  253
  260
  267
  275
  284
  294
  304
  316
  328
  341
  355
  369
  385
  402
  419
  438
  457
  478
  500
  523
  548
  574
  601
  629
  660
  691
  725
  760
  797
Total liabilities and equity, $m
  424
  433
  445
  457
  471
  486
  503
  521
  541
  561
  584
  608
  632
  659
  688
  718
  750
  783
  819
  856
  896
  938
  983
  1,029
  1,077
  1,130
  1,183
  1,241
  1,301
  1,364
Debt-to-equity ratio
  0.290
  0.300
  0.310
  0.320
  0.330
  0.340
  0.360
  0.370
  0.380
  0.390
  0.400
  0.420
  0.430
  0.440
  0.450
  0.460
  0.470
  0.480
  0.490
  0.500
  0.510
  0.520
  0.530
  0.540
  0.550
  0.550
  0.560
  0.570
  0.570
  0.580
Adjusted equity ratio
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584
  0.584

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  45
  46
  48
  49
  51
  53
  55
  57
  59
  61
  73
  76
  79
  82
  86
  89
  93
  97
  101
  106
  110
  115
  120
  126
  132
  138
  144
  151
  158
  166
Depreciation, amort., depletion, $m
  28
  28
  28
  29
  29
  30
  30
  31
  32
  32
  21
  21
  22
  23
  24
  25
  27
  28
  29
  30
  32
  33
  35
  36
  38
  40
  42
  44
  46
  48
Funds from operations, $m
  73
  74
  76
  78
  80
  82
  85
  88
  91
  94
  94
  98
  101
  106
  110
  115
  119
  125
  130
  136
  142
  148
  155
  162
  170
  178
  186
  195
  204
  214
Change in working capital, $m
  3
  4
  5
  5
  6
  6
  7
  7
  8
  8
  9
  10
  10
  11
  12
  12
  13
  14
  15
  15
  16
  17
  18
  19
  20
  21
  22
  23
  25
  26
Cash from operations, $m
  69
  70
  71
  73
  74
  76
  78
  80
  83
  85
  85
  88
  91
  95
  98
  102
  106
  111
  116
  121
  126
  131
  137
  143
  150
  157
  164
  172
  180
  188
Maintenance CAPEX, $m
  -15
  -15
  -15
  -16
  -16
  -17
  -17
  -18
  -18
  -19
  -20
  -21
  -21
  -22
  -23
  -24
  -25
  -27
  -28
  -29
  -30
  -32
  -33
  -35
  -36
  -38
  -40
  -42
  -44
  -46
New CAPEX, $m
  -3
  -3
  -4
  -4
  -4
  -5
  -5
  -6
  -6
  -7
  -7
  -8
  -8
  -9
  -9
  -10
  -10
  -11
  -11
  -12
  -13
  -13
  -14
  -15
  -16
  -16
  -17
  -18
  -19
  -20
Cash from investing activities, $m
  -18
  -18
  -19
  -20
  -20
  -22
  -22
  -24
  -24
  -26
  -27
  -29
  -29
  -31
  -32
  -34
  -35
  -38
  -39
  -41
  -43
  -45
  -47
  -50
  -52
  -54
  -57
  -60
  -63
  -66
Free cash flow, $m
  52
  52
  52
  53
  54
  55
  56
  57
  58
  60
  58
  60
  62
  64
  66
  68
  71
  74
  76
  80
  83
  86
  90
  94
  98
  102
  107
  112
  117
  122
Issuance/(repayment) of debt, $m
  4
  4
  5
  5
  6
  6
  7
  7
  8
  9
  9
  10
  10
  11
  12
  13
  13
  14
  15
  16
  17
  17
  18
  19
  20
  21
  23
  24
  25
  26
Issuance/(repurchase) of shares, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  4
  4
  5
  5
  6
  6
  7
  7
  8
  9
  9
  10
  10
  11
  12
  13
  13
  14
  15
  16
  17
  17
  18
  19
  20
  21
  23
  24
  25
  26
Total cash flow (excl. dividends), $m
  55
  56
  57
  58
  59
  61
  62
  64
  66
  68
  67
  69
  72
  75
  78
  81
  84
  88
  91
  95
  99
  104
  108
  113
  118
  124
  129
  135
  142
  148
Retained Cash Flow (-), $m
  -5
  -6
  -7
  -7
  -8
  -9
  -10
  -10
  -11
  -12
  -13
  -14
  -15
  -16
  -17
  -18
  -19
  -20
  -21
  -22
  -23
  -24
  -26
  -27
  -29
  -30
  -32
  -33
  -35
  -37
Prev. year cash balance distribution, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
  50
  50
  51
  51
  51
  52
  53
  54
  55
  56
  54
  56
  57
  59
  61
  63
  65
  68
  70
  73
  76
  79
  83
  86
  90
  94
  98
  102
  107
  111
Discount rate, %
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
  48
  46
  44
  42
  40
  38
  36
  34
  32
  29
  26
  24
  22
  20
  18
  16
  14
  13
  11
  9
  8
  7
  5
  4
  3
  3
  2
  2
  1
  1
Current shareholders' claim on cash, %
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

John B. Sanfilippo & Son, Inc. is a processor and distributor of peanuts, pecans, cashews, walnuts, almonds and other nuts. The Company offers nuts under a range of private brands and under the Fisher, Orchard Valley Harvest, Fisher Nut Exactly and Sunshine Country brand names. The Company also markets and distributes a diverse product line of food and snack products, including snack mixes, salad toppings, snacks, snack bites, trail mixes, dried fruit, and chocolate and yogurt coated products under private brands and brand names. The Company's principal products are raw and processed nuts. The Company's nut product line includes black walnuts, English walnuts, macadamia nuts, pistachios, pine nuts, Brazil nuts and filberts. The Company's products are sold through various distribution channels to buyers of nuts, including food retailers, commercial ingredient users, contract packaging customers and international customers.

FINANCIAL RATIOS  of  John B. Sanfilippo & Son, Inc. (JBSS)

Valuation Ratios
P/E Ratio 24.9
Price to Sales 1.1
Price to Book 3.8
Price to Tangible Book
Price to Cash Flow 16.9
Price to Free Cash Flow 21.3
Growth Rates
Sales Growth Rate -11%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -26.7%
Cap. Spend. - 3 Yr. Gr. Rate 1.9%
Financial Strength
Quick Ratio 0
Current Ratio 0
LT Debt to Equity 11.1%
Total Debt to Equity 25.1%
Interest Coverage 19
Management Effectiveness
Return On Assets 9.6%
Ret/ On Assets - 3 Yr. Avg. 8.3%
Return On Total Capital 12.2%
Ret/ On T. Cap. - 3 Yr. Avg. 10.2%
Return On Equity 14.8%
Return On Equity - 3 Yr. Avg. 13.1%
Asset Turnover 2.1
Profitability Ratios
Gross Margin 16.8%
Gross Margin - 3 Yr. Avg. 15.3%
EBITDA Margin 8.6%
EBITDA Margin - 3 Yr. Avg. 7.6%
Operating Margin 7%
Oper. Margin - 3 Yr. Avg. 6.1%
Pre-Tax Margin 6.4%
Pre-Tax Margin - 3 Yr. Avg. 5.4%
Net Profit Margin 4.3%
Net Profit Margin - 3 Yr. Avg. 3.6%
Effective Tax Rate 33.3%
Eff/ Tax Rate - 3 Yr. Avg. 34.6%
Payout Ratio 155.6%

JBSS stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the JBSS stock intrinsic value calculation we used $889 million for the last fiscal year's total revenue generated by John B. Sanfilippo & Son, Inc.. The default revenue input number comes from 0001 income statement of John B. Sanfilippo & Son, Inc.. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our JBSS stock valuation model: a) initial revenue growth rate of 2% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.3%, whose default value for JBSS is calculated based on our internal credit rating of John B. Sanfilippo & Son, Inc., is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of John B. Sanfilippo & Son, Inc..
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of JBSS stock the variable cost ratio is equal to 92.8%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for JBSS stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.5% for John B. Sanfilippo & Son, Inc..

Corporate tax rate of 27% is the nominal tax rate for John B. Sanfilippo & Son, Inc.. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the JBSS stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for JBSS are equal to 14.9%.

Life of production assets of 9 years is the average useful life of capital assets used in John B. Sanfilippo & Son, Inc. operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for JBSS is equal to 19.1%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $243.002 million for John B. Sanfilippo & Son, Inc. - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 11.387 million for John B. Sanfilippo & Son, Inc. is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of John B. Sanfilippo & Son, Inc. at the current share price and the inputted number of shares is $0.9 billion.

RELATED COMPANIES Price Int.Val. Rating
PEP Pepsico, Inc. 132.73 87.80  sell

CONTACT US      

About X-FIN       Privacy policy       Terms of use      

Copyright © X-FIN.com 2005-2019. All rigths reserved.