ASX:FNP

Stock Analysis Report

Executive Summary

Freedom Foods Group Limited engages in sourcing, manufacturing, selling, marketing, and distribution of plant-based beverages, and dairy and nutritional ingredient products in Australia, New Zealand, China, South East Asia, and North America.

Rewards

Earnings are forecast to grow 49.14% per year

Risk Analysis

High level of non-cash earnings

Profit margins (2.4%) are lower than last year (3.6%)

Shareholders have been diluted in the past year



Snowflake Analysis

High growth potential with adequate balance sheet.


Similar Companies

Share Price & News

How has Freedom Foods Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: FNP has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-3.0%

FNP

-1.2%

AU Food

-2.0%

AU Market


1 Year Return

4.0%

FNP

-16.3%

AU Food

16.7%

AU Market

Return vs Industry: FNP exceeded the Australian Food industry which returned -16.3% over the past year.

Return vs Market: FNP underperformed the Australian Market which returned 16.7% over the past year.


Shareholder returns

FNPIndustryMarket
7 Day-3.0%-1.2%-2.0%
30 Day-3.0%-0.06%-0.7%
90 Day-11.4%-0.3%0.2%
1 Year5.4%4.0%-13.2%-16.3%22.5%16.7%
3 Year19.6%15.5%8.3%0.7%35.4%16.8%
5 Year70.3%60.6%37.8%25.7%60.6%24.4%

Price Volatility Vs. Market

How volatile is Freedom Foods Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Freedom Foods Group undervalued compared to its fair value and its price relative to the market?

109.6x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: FNP (A$5.14) is trading above our estimate of fair value (A$2.62)

Significantly Below Fair Value: FNP is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: FNP is poor value based on its PE Ratio (109.6x) compared to the Food industry average (23.6x).

PE vs Market: FNP is poor value based on its PE Ratio (109.6x) compared to the Australian market (18.6x).


Price to Earnings Growth Ratio

PEG Ratio: FNP is poor value based on its PEG Ratio (2.2x)


Price to Book Ratio

PB vs Industry: FNP is overvalued based on its PB Ratio (2.1x) compared to the AU Food industry average (1.4x).


Next Steps

Future Growth

How is Freedom Foods Group forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

49.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FNP's forecast earnings growth (49.1% per year) is above the savings rate (1.1%).

Earnings vs Market: FNP's earnings (49.1% per year) are forecast to grow faster than the Australian market (9.4% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: FNP's revenue (21.2% per year) is forecast to grow faster than the Australian market (3.6% per year).

High Growth Revenue: FNP's revenue (21.2% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: FNP's Return on Equity is forecast to be low in 3 years time (11%).


Next Steps

Past Performance

How has Freedom Foods Group performed over the past 5 years?

-31.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FNP has a high level of non-cash earnings.

Growing Profit Margin: FNP's current net profit margins (2.4%) are lower than last year (3.6%).


Past Earnings Growth Analysis

Earnings Trend: FNP's earnings have declined by -31.8% per year over the past 5 years.

Accelerating Growth: FNP's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: FNP had negative earnings growth (-9%) over the past year, making it difficult to compare to the Food industry average (-17.6%).


Return on Equity

High ROE: FNP's Return on Equity (1.7%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Freedom Foods Group's financial position?


Financial Position Analysis

Short Term Liabilities: FNP's short term assets (A$266.8M) exceed its short term liabilities (A$171.5M).

Long Term Liabilities: FNP's short term assets (A$266.8M) exceed its long term liabilities (A$142.5M).


Debt to Equity History and Analysis

Debt Level: FNP's debt to equity ratio (17.1%) is considered satisfactory.

Reducing Debt: FNP's debt to equity ratio has increased from 0.8% to 17.1% over the past 5 years.

Debt Coverage: FNP's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: FNP's interest payments on its debt are well covered by EBIT (5.2x coverage).


Balance Sheet

Inventory Level: FNP has a high level of physical assets or inventory.

Debt Coverage by Assets: FNP's debt is covered by short term assets (assets are 2.3x debt).


Next Steps

Dividend

What is Freedom Foods Group's current dividend yield, its reliability and sustainability?

1.07%

Current Dividend Yield


Dividend Yield vs Market

company1.1%marketbottom25%2.4%markettop25%5.6%industryaverage3.6%forecastin3Years2.2%

Current dividend yield vs market & industry

Notable Dividend: FNP's dividend (1.07%) isn’t notable compared to the bottom 25% of dividend payers in the Australian market (2.44%).

High Dividend: FNP's dividend (1.07%) is low compared to the top 25% of dividend payers in the Australian market (5.59%).


Stability and Growth of Payments

Stable Dividend: FNP is not paying a notable dividend for the Australian market, therefore no need to check if payments are stable.

Growing Dividend: FNP is not paying a notable dividend for the Australian market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: FNP is not paying a notable dividend for the Australian market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of FNP's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

What is the CEO of Freedom Foods Group's salary, the management and board of directors tenure and is there insider trading?

3.3yrs

Average management tenure


CEO

Rory J. Macleod (51yo)

7.3yrs

Tenure

AU$2,470,174

Compensation

Mr. Rory J. F. Macleod, B.Econ (Hons) has been the Chief Executive Officer and Managing Director of Freedom Foods Group Limited since August 2012 and served as its Secretary since October 2010 Chief Financ ...


CEO Compensation Analysis

Compensation vs Market: Rory J.'s total compensation ($USD1.69M) is above average for companies of similar size in the Australian market ($USD969.80K).

Compensation vs Earnings: Rory J.'s compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

3.3yrs

Average Tenure

Experienced Management: FNP's management team is considered experienced (3.3 years average tenure).


Board Age and Tenure

11.6yrs

Average Tenure

67yo

Average Age

Experienced Board: FNP's board of directors are seasoned and experienced ( 11.6 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyAU$332,85123 Jun 19
Rory J. Macleod
EntityIndividual
Role
Chief Executive Officer
MD, CEO & Executive Director
Shares69,344
Max PriceAU$4.80
BuyAU$31,56023 Jun 19
Trevor Allen
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares6,575
Max PriceAU$4.80
BuyAU$300,37923 Jun 19
Perry Gunner
EntityIndividual
Role
Chairman of the Board
Independent Non-Executive Chairman
Shares62,579
Max PriceAU$4.80
BuyAU$4,050,28823 Jun 19
Leppington Pastoral Co Pty Ltd
EntityCompany
Shares843,810
Max PriceAU$4.80
BuyAU$35,947,72604 Jun 19
Leppington Pastoral Co Pty Ltd
EntityCompany
Shares7,489,111
Max PriceAU$4.80

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 16.2%.


Management Team

  • Rory J. Macleod (51yo)

    MD, CEO & Executive Director

    • Tenure: 7.3yrs
    • Compensation: AU$2.47m
  • Campbell Nicholas

    Chief Financial Officer

    • Tenure: 3.3yrs
    • Compensation: AU$661.96k
  • Amine Haddad

    Chief Executive Officer of Commercial Operations - Australasia

    • Tenure: 0yrs
    • Compensation: AU$1.64m
  • Tim Moses

    Strategic Development Director

    • Tenure: 0yrs
    • Compensation: AU$535.16k
  • Amber Stanley

    Group General Counsel

    • Tenure: 2yrs

Board Members

  • Perry Gunner (72yo)

    Independent Non-Executive Chairman

    • Tenure: 13.4yrs
    • Compensation: AU$147.50k
  • Rory J. Macleod (51yo)

    MD, CEO & Executive Director

    • Tenure: 7.3yrs
    • Compensation: AU$2.47m
  • Ron Perich (76yo)

    Non-Executive Director

    • Tenure: 14.7yrs
    • Compensation: AU$127.50k
  • Tony Perich (78yo)

    Deputy Chairman

    • Tenure: 0yrs
    • Compensation: AU$137.50k
  • Michael Perich (44yo)

    Alternate Non-Executive Director

    • Tenure: 10.8yrs
    • Compensation: AU$35.00k
  • Trevor Allen (62yo)

    Independent Non-Executive Director

    • Tenure: 6.4yrs
    • Compensation: AU$127.50k

Company Information

Freedom Foods Group Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Freedom Foods Group Limited
  • Ticker: FNP
  • Exchange: ASX
  • Founded: 1986
  • Industry: Packaged Foods and Meats
  • Sector: Food, Beverage & Tobacco
  • Market Cap: AU$1.406b
  • Shares outstanding: 273.46m
  • Website: https://ffgl.com.au

Number of Employees


Location

  • Freedom Foods Group Limited
  • 80 Box Road
  • Taren Point
  • New South Wales
  • 2229
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FNPASX (Australian Securities Exchange)YesOrdinary SharesAUAUDJan 1992
FNPCHIA (Chi-X Australia)YesOrdinary SharesAUAUDJan 1992
FRDZ.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992

Biography

Freedom Foods Group Limited engages in sourcing, manufacturing, selling, marketing, and distribution of plant-based beverages, and dairy and nutritional ingredient products in Australia, New Zealand, China ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/08 10:31
End of Day Share Price2019/12/06 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.