TSX:SAP

Stock Analysis Report

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Executive Summary

Saputo Inc. produces, markets, and distributes dairy products in Canada, the United States, Argentina, Australia, and internationally.


Snowflake Analysis

Established dividend payer with mediocre balance sheet.


Similar Companies

Share Price & News

How has Saputo's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-0.6%

SAP

0.1%

CA Food

0.9%

CA Market


1 Year Return

-27.2%

SAP

-22.0%

CA Food

-11.4%

CA Market

Return vs Industry: SAP underperformed the Canadian Food industry which returned -20.3% over the past year.

Return vs Market: SAP underperformed the Canadian Market which returned -11.3% over the past year.


Shareholder returns

SAPIndustryMarket
7 Day-0.6%0.1%0.9%
30 Day-5.0%0.9%4.5%
90 Day-11.7%-5.6%-9.3%
1 Year-25.9%-27.2%-20.5%-22.0%-8.4%-11.4%
3 Year-20.0%-23.7%-21.4%-25.6%0.4%-8.9%
5 Year12.9%4.4%15.5%6.1%16.9%-0.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Saputo undervalued compared to its fair value and its price relative to the market?

2.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: SAP (CA$32.96) is trading below our estimate of fair value (CA$33.94)

Significantly Below Fair Value: SAP is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: SAP is poor value based on its PE Ratio (21.1x) compared to the Food industry average (16.8x).

PE vs Market: SAP is poor value based on its PE Ratio (21.1x) compared to the Canadian market (13x).


Price to Earnings Growth Ratio

PEG Ratio: SAP is poor value based on its PEG Ratio (2x)


Price to Book Ratio

PB vs Industry: SAP is overvalued based on its PB Ratio (2.2x) compared to the CA Food industry average (1.5x).


Next Steps

Future Growth

How is Saputo forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

10.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SAP's forecast earnings growth (10.6% per year) is above the savings rate (1.7%).

Earnings vs Market: SAP's earnings (10.6% per year) are forecast to grow slower than the Canadian market (23.9% per year).

High Growth Earnings: SAP's earnings are forecast to grow, but not significantly.

Revenue vs Market: SAP's revenue (3% per year) is forecast to grow slower than the Canadian market (6.2% per year).

High Growth Revenue: SAP's revenue (3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SAP's Return on Equity is forecast to be low in 3 years time (11.6%).


Next Steps

Past Performance

How has Saputo performed over the past 5 years?

5.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SAP has high quality earnings.

Growing Profit Margin: SAP's current net profit margins (4.3%) are lower than last year (5.9%).


Past Earnings Growth Analysis

Earnings Trend: SAP's earnings have grown by 5.4% per year over the past 5 years.

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

Earnings vs Industry: SAP had negative earnings growth (-18.8%) over the past year, making it difficult to compare to the Food industry average (-8.9%).


Return on Equity

High ROE: SAP's Return on Equity (10.1%) is considered low.


Next Steps

Financial Health

How is Saputo's financial position?


Financial Position Analysis

Short Term Liabilities: SAP's short term assets (CA$3.9B) exceed its short term liabilities (CA$2.3B).

Long Term Liabilities: SAP's short term assets (CA$3.9B) do not cover its long term liabilities (CA$4.7B).


Debt to Equity History and Analysis

Debt Level: SAP's debt to equity ratio (65.3%) is considered high.

Reducing Debt: SAP's debt to equity ratio has increased from 61.5% to 65.3% over the past 5 years.

Debt Coverage: SAP's debt is well covered by operating cash flow (24.2%).

Interest Coverage: SAP's interest payments on its debt are well covered by EBIT (10.5x coverage).


Balance Sheet


Next Steps

Dividend

What is Saputo's current dividend yield, its reliability and sustainability?

2.06%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: SAP's dividend (2.06%) is higher than the bottom 25% of dividend payers in the Canadian market (2.02%).

High Dividend: SAP's dividend (2.06%) is low compared to the top 25% of dividend payers in the Canadian market (6.46%).


Stability and Growth of Payments

Stable Dividend: SAP's dividends per share have been stable in the past 10 years.

Growing Dividend: SAP's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (43.2%), SAP's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SAP's dividends in 3 years are forecast to be well covered by earnings (36.7% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

4.2yrs

Average management tenure


CEO

Lino Saputo (52yo)

16.25yrs

Tenure

CA$3,648,840

Compensation

Mr. Lino A. Saputo, Jr., has been Chief Executive Officer of Saputo Inc. since March 2004 and has been its Chairman of the Board since August 2017 and Director since 2001. Mr. Saputo has been a Director of ...


CEO Compensation Analysis

Compensation vs Market: Lino's total compensation ($USD2.68M) is below average for companies of similar size in the Canadian market ($USD6.86M).

Compensation vs Earnings: Lino's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Lino Saputo
Chairman & CEO16.25yrsCA$3.65m0.024% CA$3.2m
Kai Bockmann
President and COO of Saputo Inc. & the International Sector3.17yrsCA$5.32m0.012% CA$1.6m
Maxime Therrien
CFO & Secretary2.83yrsCA$2.84m0.0053% CA$707.3k
Louis-Philippe Carrière
Senior Advisor & Corporate Director2.83yrsno data0.011% CA$1.5m
Terry Brockman
President & COO of Cheese Division - USA14.17yrsCA$4.02m0.020% CA$2.8m
Carl Colizza
President & COO - North America and Interim of Dairy Foods Division (USA)5.17yrsCA$3.30m0.0069% CA$929.5k
Marlene Robillard
Director of Communications & Public Relationsno datano datano data
Isabelle Viger
Senior Vice President of Legal Affairsno datano data0.0019% CA$254.6k
Gaétane Wagner
Chief Human Resources Officer5.42yrsCA$690.72k0.0073% CA$979.4k
Paul Corney
Executive Officer0.17yrCA$3.96m0.0062% CA$829.9k

4.2yrs

Average Tenure

58yo

Average Age

Experienced Management: SAP's management team is considered experienced (4.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Lino Saputo
Chairman & CEO16.25yrsCA$3.65m0.024% CA$3.2m
Louis-Philippe Carrière
Senior Advisor & Corporate Director2.83yrsno data0.011% CA$1.5m
Annette Verschuren
Independent Director6.83yrsCA$260.00k0.0020% CA$264.0k
Henry Demone
Corporate Director7.92yrsCA$260.00k0.0024% CA$330.1k
Karen Kinsley
Corporate Director4.58yrsCA$260.00k0.0017% CA$223.6k
Antonio Meti
Independent Director12.42yrsCA$315.00k0.0051% CA$685.7k
Franziska Ruf
Independent Director3.83yrsCA$260.00k0.00049% CA$66.0k
Diane Nyisztor
Independent Director3.83yrsCA$260.00k0.0012% CA$164.4k
Annalisa King
Independent Director7.92yrsCA$260.00k0.00074% CA$99.7k
Anthony Fata
Independent Lead Directorno dataCA$340.00k0.0029% CA$396.1k

4.6yrs

Average Tenure

57yo

Average Age

Experienced Board: SAP's board of directors are considered experienced (4.6 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

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


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 4.6%.


Top Shareholders

Company Information

Saputo Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Saputo Inc.
  • Ticker: SAP
  • Exchange: TSX
  • Founded: 1954
  • Industry: Packaged Foods and Meats
  • Sector: Food, Beverage & Tobacco
  • Market Cap: CA$13.472b
  • Shares outstanding: 408.73m
  • Website: https://www.saputo.com

Number of Employees


Location

  • Saputo Inc.
  • 6869, Métropolitain Boulevard East
  • Montréal
  • Quebec
  • H1P 1X8
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SAPTSX (The Toronto Stock Exchange)YesCommon SharesCACADOct 1997
SB7DB (Deutsche Boerse AG)YesCommon SharesDEEUROct 1997
SAPI.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDOct 1997

Biography

Saputo Inc. produces, markets, and distributes dairy products in Canada, the United States, Argentina, Australia, and internationally. The company offers cheeses, including mozzarella and cheddar; specialty cheeses, such as ricotta, provolone, parmesan, goat cheese, feta, and havarti; fine cheeses comprising brie and camembert; and other cheeses that include brick, colby, farmer, munster, monterey jack, fresh curd, and processed cheeses. It also provides fluid milk, cream, yogurt, sour cream, cottage cheese, and ice cream mixes, as well as other dairy and non-dairy products, which comprise butter, flavored cream, dips, and flavored coffee whitener. In addition, the company offers dairy ingredients, including milk powder, whey powder, lactose, and whey protein concentrates; and distributes fine imported cheese to specialty stores, as well as non-dairy products manufactured by third parties. It serves customers in the retail, foodservice, and industrial segments. The company sells its products under the Saputo, Alexis de Portneuf, Armstrong, Cathedral City, Clover, COON, Cracker Barrel, Dairyland, DairyStar, Devondale, Friendship Dairies, Frigo Cheese Heads, Joyya, La Paulina, Liddells, Milk2Go/Lait’s Go, Montchevre, Murray Goulburn Ingredients, Neilson, Nutrilait, Scotsburn, Stella, Sungold, Treasure Cave, and Woolwich Goat Dairy brands. Saputo Inc. was founded in 1954 and is headquartered in Montréal, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/02 03:33
End of Day Share Price2020/06/01 00:00
Earnings2019/12/31
Annual Earnings2019/03/31


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.