NasdaqGS:SAFM

Stock Analysis Report

Executive Summary

Sanderson Farms, Inc., an integrated poultry processing company, produces, processes, markets, and distributes fresh, frozen, and prepared chicken products in the United States.

Snowflake

Fundamentals

Adequate balance sheet with reasonable growth potential.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

3.4%

NasdaqGS:SAFM

1.8%

US Food

2.9%

US Market


1 Year Return

36.3%

NasdaqGS:SAFM

-0.3%

US Food

0.2%

US Market

SAFM outperformed the Food industry which returned -1.4% over the past year.

SAFM outperformed the Market in United States of America which returned -0.7% over the past year.


Share holder returns

SAFMIndustryMarket
7 Day3.4%1.8%2.9%
30 Day11.3%-1.0%-2.3%
90 Day-3.4%2.6%3.1%
1 Year37.7%36.3%2.7%-0.3%2.4%0.2%
3 Year60.2%52.9%-6.9%-15.0%41.7%32.4%
5 Year70.5%57.2%41.0%24.2%55.1%37.9%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Sanderson Farms undervalued based on future cash flows and its price relative to the stock market?

41%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Sanderson Farms's share price is below the future cash flow value, and at a moderate discount (> 20%).

Sanderson Farms's share price is below the future cash flow value, and at a substantial discount (> 40%).


Price Based on Earnings

Sanderson Farms is loss making, we can't compare its value to the US Food industry average.

Sanderson Farms is loss making, we can't compare the value of its earnings to the United States of America market.


Price Based on Expected Growth

Unable to calculate PEG ratio for Sanderson Farms, we can't assess if its growth is good value.


Price Based on Value of Assets

Sanderson Farms is overvalued based on assets compared to the US Food industry average.


Next Steps

Future Growth

How is Sanderson Farms expected to perform in the next 1 to 3 years based on estimates from 5 analysts?

104.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Sanderson Farms's revenue is expected to grow by 7.5% yearly, however this is not considered high growth (20% yearly).

Sanderson Farms's earnings are expected to grow significantly at over 20% yearly.

Sanderson Farms's revenue growth is expected to exceed the United States of America market average.

Sanderson Farms's earnings growth is expected to exceed the United States of America market average.

Sanderson Farms's earnings growth is expected to exceed the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

Unable to establish if Sanderson Farms will efficiently use shareholders’ funds in the future without estimates of Return on Equity.


Next Steps

Past Performance

How has Sanderson Farms performed over the past 5 years?

-13.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Sanderson Farms does not make a profit and their year on year earnings growth rate was negative over the past 5 years.

Unable to compare Sanderson Farms's 1-year earnings growth to the 5-year average as it is not currently profitable.

Unable to compare Sanderson Farms's 1-year growth to the US Food industry average as it is not currently profitable.


Return on Equity

It is difficult to establish if Sanderson Farms has efficiently used shareholders’ funds last year (Return on Equity greater than 20%) as it is loss-making.


Return on Assets

It is difficult to establish if Sanderson Farms has efficiently used its assets last year compared to the US Food industry average (Return on Assets) as it is loss-making.


Return on Capital Employed

It is difficult to establish if Sanderson Farms improved its use of capital last year versus 3 years ago (Return on Capital Employed) as it is currently loss-making.


Next Steps

Financial Health

How is Sanderson Farms's financial position?


Financial Position Analysis

Sanderson Farms is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Sanderson Farms's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

Sanderson Farms's level of debt (7.1%) compared to net worth is satisfactory (less than 40%).

The level of debt compared to net worth has increased over the past 5 years (4% vs 7.1% today).

Debt is well covered by operating cash flow (135.2%, greater than 20% of total debt).

Unable to confirm if the interest payments on Sanderson Farms's debt are well covered by earnings due to lack of past financial data.


Balance Sheet

High level of physical assets or inventory.

Debt is covered by short term assets, assets are 5.7x debt.


Next Steps

Dividend

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

0.90%

Expected Dividend Yield


Dividend Yield and Payments Analysis

Sanderson Farms's pays a lower dividend yield than the bottom 25% of dividend payers in United States of America (1.49%).

Sanderson Farms's dividend is below the markets top 25% of dividend payers in United States of America (3.85%).

Dividends per share have been volatile in the past 10 years (annual drop of over 20%).

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

The company is paying a dividend however it is incurring a loss.


Future Payout to Shareholders

Dividends after 3 years are expected to be thoroughly covered by earnings (6.8x coverage).


Next Steps

Management

What is the CEO of Sanderson Farms's salary, the management and board of directors tenure and is there insider trading?

20.3yrs

Average management tenure


CEO

Joe Sanderson (71yo)

29.8yrs

Tenure

US$4,226,166

Compensation

Mr. Joe F. Sanderson, Jr. has been the Chairman of Sanderson Farms, Inc. since January 8, 1998 and as its Chief Executive Officer since November 1, 1989. Mr. Sanderson served as the President of Sanderson  ...


CEO Compensation Analysis

Joe's remuneration is about average for companies of similar size in United States of America.

Joe's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

20.3yrs

Average Tenure

64.5yo

Average Age

The average tenure for the Sanderson Farms management team is over 5 years, this suggests they are a seasoned and experienced team.


Board Age and Tenure

17.6yrs

Average Tenure

67yo

Average Age

The average tenure for the Sanderson Farms board of directors is over 10 years, this suggests they are a seasoned and experienced board.


Insider Trading

No 3 month open market individual insider trading information.


Recent Insider Transactions

SellUS$1,278,23619 Mar 19
Lampkin Butts
EntityIndividual
Role
Member of the Board of Directors
President
Shares10,000
Max PriceUS$129.07
SellUS$77,13728 Feb 19
John Bierbusse
EntityIndividual
Shares677
Max PriceUS$113.94
SellUS$29,10427 Dec 18
Gail Pittman
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares300
Max PriceUS$97.08
SellUS$53,57229 Aug 18
Phil Livingston
EntityIndividual
Role
Lead Director
Lead Director
Shares500
Max PriceUS$107.19
SellUS$96,19827 Aug 18
John Bierbusse
EntityIndividual
Shares875
Max PriceUS$109.94

Ownership Breakdown


Management Team

  • Joe Sanderson (71yo)

    Chairman & CEO

    • Tenure: 29.8yrs
    • Compensation: US$4.23m
  • Mike Cockrell (61yo)

    CFO, Treasurer & Director

    • Tenure: 21.5yrs
    • Compensation: US$1.23m
  • Lampkin Butts (68yo)

    President

    • Tenure: 21.5yrs
    • Compensation: US$1.44m
  • Robin Robinson

    Director of Organization Development & Corporate Communication

    • Tenure: 0.0yrs
  • Bob Rosa

    Chief Financial Analyst

    • Tenure: 0.0yrs
  • Brian Romano

    Director of Administration & Human Resources

    • Tenure: 0.0yrs
  • Tim Rigney (55yo)

    Corporate Secretary

    • Tenure: 6.8yrs
    • Compensation: US$438.55k
  • Hilary Burroughs

    Director of Marketing

    • Tenure: 0.0yrs

Board Members

  • Joe Sanderson (71yo)

    Chairman & CEO

    • Tenure: 29.8yrs
    • Compensation: US$4.23m
  • Mike Cockrell (61yo)

    CFO, Treasurer & Director

    • Tenure: 21.5yrs
    • Compensation: US$1.23m
  • Lampkin Butts (68yo)

    President

    • Tenure: 21.5yrs
    • Compensation: US$1.44m
  • John Baker (77yo)

    Independent Director

    • Tenure: 25.6yrs
    • Compensation: US$238.79k
  • Phil Livingston (75yo)

    Lead Director

    • Tenure: 0.0yrs
    • Compensation: US$280.51k
  • Edith Kelly-Green (66yo)

    Independent Director

    • Tenure: 0.9yrs
    • Compensation: US$10.28k
  • Gail Pittman (65yo)

    Independent Director

    • Tenure: 17.6yrs
    • Compensation: US$260.52k
  • Suzanne Mestayer (66yo)

    Independent Director

    • Tenure: 2.1yrs
    • Compensation: US$235.57k
  • Toni Cooley (58yo)

    Independent Director

    • Tenure: 12.6yrs
    • Compensation: US$241.14k
  • Fred Banks (76yo)

    Independent Director

    • Tenure: 12.6yrs
    • Compensation: US$280.27k

Company Information

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


Key Information

  • Name: Sanderson Farms, Inc.
  • Ticker: SAFM
  • Exchange: NasdaqGS
  • Founded: 1947
  • Industry: Packaged Foods and Meats
  • Sector: Food, Beverage & Tobacco
  • Market Cap: US$3.223b
  • Shares outstanding: 22.15m
  • Website: https://www.sandersonfarms.com

Number of Employees


Location

  • Sanderson Farms, Inc.
  • 127 Flynt Road
  • Laurel
  • Mississippi
  • 39443
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SAFMNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDMay 1987
SF9DB (Deutsche Boerse AG)YesCommon StockDEEURMay 1987

Biography

Sanderson Farms, Inc., an integrated poultry processing company, produces, processes, markets, and distributes fresh, frozen, and prepared chicken products in the United States. The company sells ice-packe ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/21 23:44
End of Day Share Price2019/08/21 00:00
Earnings2019/04/30
Annual Earnings2018/10/31


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.