Hain Celestial Group (HAIN:NAS) Fundamental Valuation Report

Fundamental Valuation Report

Hain Celestial Group(HAIN:NAS)

Consumer Defensive:Packaged Foods

This Report was generated using the valuation tools available on StockCalc.com. For a free 30 day trial click here.

Close Price/Date
$33.52 (USD) 09/02/2020

Weighted Valuation
$32.34 (USD)

Overall Rating
Fairly valued to slightly Overvalued by 3.5%

Valuation Models Comparables: $36.18 (USD)
(in order of importance) Adjusted Book Value: $30.20 (USD)
Multiples: $27.88 (USD)
Valuation Methods This company is:
Cash Flow: Overvalued on a Cash Flow Valuation
Comparable Company: Undervalued on a Comparable Valuation
Asset: Overvalued on an Asset Valuation
According to Analyst consensus at $30.50 this stock is Overvalued

Company Overview (HAIN:NAS USD)

Price 33.52
Range 33.19 – 33.87
52 week 19.17 – 34.44
Open 33.46
Vol / Avg. 804498/745829
Mkt cap 3.42B
P/E 134.08
Div/yield 0.00/0.00
EPS -0.77
Shares 101.89M
Beta 0.75

Company Description

Hain Celestial makes better-for- you natural and organic consumer products, with 74% of revenue considered grocery, 13% snacks, 8% personal care, and 5% tea. Some of the company’s most recognized brands are Celestial Seasonings (tea), Terra (chips), Garden of Eatin’ (chips), Sensible Portions (snacks), The Greek Gods (yogurt), Earth’s Best (baby food and care), and Ella’s Kitchen (baby food). The company primarily sells in developed markets, including the U.S. (44% of revenue), U.K. (38%), Canada (9%), and Europe (9%). Its products can be found in traditional grocery stores, natural foods supermarkets, specialty health stores, mass-market retailers, club warehouses, drugstores, convenience stores, and restaurants and on e-commerce sites.

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for HAIN:NAS

Using a discounted cash flow model we generated an intrinsic value of $6.71 (USD) for HAIN:NAS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

HAIN:NAS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $6.71 1% 5% 1% 5%
WACC (or Ke) 7.70 $10.63 $4.09
Terminal Growth Rate 2.70 $4.29 $10.34
Tax Rate 0.18 $8.02 $5.39
Cash Flow 193,073,696 $5.26 $8.16
Capital Expenditures -69,863,200 $6.23 $7.18
Long Term Debt 917,433,000 $7.16 $6.26

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $34.41 (USD) for HAIN:NAS. We also generated a valuation of $36.18 (USD) using other metrics and comparables.
The comparable companies were B&G Foods (BGS:NYS), Calavo Growers (CVGW:NAS), Central Garden & Pet (CENT:NAS), Flowers Foods (FLO:NYS) and Lancaster Colony (LANC:NAS).

Company HAIN:NAS End Date Value
Earnings/Share ($0.77) (USD)
Book Value/Share $14.17 (USD)
Sales/Share $19.76 (USD)
Cash Flow/Share $1.45 (USD)
EBITDA/Share $1.00 (USD)
Price Based on Comps Adjustment Factor (%)
($34.44) (USD) 12.5
$53.21 (USD) -35.7
$31.01 (USD) 32.1
$21.53 (USD) 32.8
$20.13 (USD) 75.8
HAIN:NAS Ratios Used Average Values BGS:NYS CVGW:NAS CENT:NAS FLO:NYS LANC:NAS
134.08 PE Ratio 44.73 17.52 96.98 20.79 52.15 36.20
2.37 PB Ratio 3.76 2.44 3.99 2.15 3.88 6.32
1.70 PS Ratio 1.57 1.09 0.93 0.90 1.22 3.71
23.05 PCF Ratio 17.22 7.24 26.48 11.45 11.96 28.97
20.58 EV to EBITDA 20.08 11.29 30.68 10.15 21.44 26.84

Multiples

Using a multiples approach we generated a valuation of  $27.88 (USD) for HAIN:NAS

Company HAIN:NAS End Date Value
Earnings/Share ($0.77) (USD)
Book Value/Share $14.17 (USD)
Sales/Share $19.76 (USD)
Cash Flow/Share $1.45 (USD)
EBITDA/Share $1.00 (USD)
Price Based on Comps Adjustment Factor
$0.00 (USD) 0
$28.70 (USD) 0
$25.82 (USD) 0
$34.72 (USD) 0
$22.26 (USD) 0
Ratios Ratio Average
PE Ratio 30.84
PB Ratio 2.03
PS Ratio 1.31
PCF Ratio 23.87
EV to EBITDA 22.21

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  HAIN:NAS for the last 10 years was  2.13

We ran the Adjusted Book Value for  HAIN:NAS and generated a book value of  $14.17 (USD)
By multiplying these we get an adjusted valuation of  $30.20 (USD)

Analyst Data

In the Stockcalc database there are 2 analysts that provide a valuation for HAIN:NAS. The 2 analysts have a concensus valuation for HAIN:NAS for 2021 of $30.50 (USD).

HAIN:NAS Hain Celestial Group

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
1 1 1 2.7500 Hold 2020-9-1

Current Price: 33.52 USD

Analyst Consensus
USD Millions 2021 2022
Mean EPS 1.04 1.18
# EPS Analysts 4 2
Mean Revenue 2,034.40 2,065.50
# Revenue Analysts 2 1
Mean Target Price 30.50
Mean Cash Flow 1.65 1.63
Mean EBITDA 204.20 219.20
Mean Net Income 100.60 98.50
Mean Debt Outstanding 346.70 245.00
Mean Tax Rate
Mean Growth Rate 26.55
Mean Capital Expenditure 71.10 62.00

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.

The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).

The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.

With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.

If we have Analyst coverage for the company we use the consensus target price here.

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