NYSE:GIS

Stock Analysis Report

Executive Summary

General Mills, Inc. manufactures and markets branded consumer foods worldwide.

Rewards

Trading at 39.3% below its fair value

Earnings grew by 4.2% over the past year

Pays a high and reliable dividend of 3.7%

Risk Analysis

Has a high level of debt

Shareholders have been diluted in the past year



Snowflake Analysis

Established dividend payer and good value.


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Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

3.1%

GIS

1.7%

US Food

2.0%

US Market


1 Year Return

23.9%

GIS

12.9%

US Food

23.6%

US Market

Return vs Industry: GIS exceeded the US Food industry which returned 13.9% over the past year.

Return vs Market: GIS matched the US Market which returned 24.4% over the past year.


Shareholder returns

GISIndustryMarket
7 Day3.1%1.7%2.0%
30 Day1.2%0.7%3.9%
90 Day2.5%6.3%12.0%
1 Year28.6%23.9%16.1%12.9%26.2%23.6%
3 Year-3.0%-13.7%1.7%-6.4%53.2%43.3%
5 Year17.8%-1.3%41.8%24.5%75.7%56.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

38.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: GIS ($53) is trading below our estimate of fair value ($87.38)

Significantly Below Fair Value: GIS is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: GIS is good value based on its PE Ratio (15.1x) compared to the Food industry average (25.4x).

PE vs Market: GIS is good value based on its PE Ratio (15.1x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: GIS is poor value based on its PEG Ratio (111.5x)


Price to Book Ratio

PB vs Industry: GIS is overvalued based on its PB Ratio (4.2x) compared to the US Food industry average (2.1x).


Next Steps

Future Growth

How is General Mills forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

0.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: GIS's forecast earnings growth (0.1% per year) is below the savings rate (1.7%).

Earnings vs Market: GIS's earnings (0.1% per year) are forecast to grow slower than the US market (14.3% per year).

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

Revenue vs Market: GIS's revenue is expected to decline over the next 3 years (-0.1% per year).

High Growth Revenue: GIS's revenue is forecast to decline over the next 3 years (-0.1% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: GIS's Return on Equity is forecast to be high in 3 years time (22.7%)


Next Steps

Past Performance

How has General Mills performed over the past 5 years?

7.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: GIS has high quality earnings.

Growing Profit Margin: GIS's current net profit margins (12.6%) are higher than last year (12.5%).


Past Earnings Growth Analysis

Earnings Trend: GIS's earnings have grown by 7.8% per year over the past 5 years.

Accelerating Growth: GIS's earnings growth over the past year (4.2%) is below its 5-year average (7.8% per year).

Earnings vs Industry: GIS earnings growth over the past year (4.2%) exceeded the Food industry -12.1%.


Return on Equity

High ROE: Whilst GIS's Return on Equity (25.21%) is high, this metric is skewed due to their high level of debt.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is General Mills's financial position?


Financial Position Analysis

Short Term Liabilities: GIS's short term assets ($4.5B) do not cover its short term liabilities ($7.4B).

Long Term Liabilities: GIS's short term assets ($4.5B) do not cover its long term liabilities ($14.5B).


Debt to Equity History and Analysis

Debt Level: GIS's debt to equity ratio (161.5%) is considered high.

Reducing Debt: GIS's debt to equity ratio has increased from 150.3% to 161.5% over the past 5 years.

Debt Coverage: GIS's debt is well covered by operating cash flow (20.7%).

Interest Coverage: GIS's interest payments on its debt are well covered by EBIT (6.3x coverage).


Balance Sheet

Inventory Level: GIS has a low level of unsold assets or inventory.

Debt Coverage by Assets: GIS's debt is not covered by short term assets (assets are 0.3x debt).


Next Steps

Dividend

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

3.64%

Current Dividend Yield


Dividend Yield vs Market

company3.6%marketbottom25%1.4%markettop25%3.7%industryaverage2.7%forecastin3Years3.7%

Current dividend yield vs market & industry

Notable Dividend: GIS's dividend (3.7%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: GIS's dividend (3.65%) is low compared to the top 25% of dividend payers in the US market (3.67%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (55.9%), GIS's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: GIS's dividends in 3 years are forecast to be covered by earnings (56.6% payout ratio).


Next Steps

Management

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

4.0yrs

Average management tenure


CEO

Jeff Harmening (52yo)

2.6yrs

Tenure

US$9,855,417

Compensation

Mr. Jeffrey L. Harmening, also known as Jeff, has been the Chief Executive Officer at General Mills, Inc. since June 1, 2017. Mr. Harmening served as the President of General Mills, Inc. since July 1, 2016 ...


CEO Compensation Analysis

Compensation vs Market: Jeff's total compensation ($USD9.86M) is about average for companies of similar size in the US market ($USD10.76M).

Compensation vs Earnings: Jeff's compensation has increased by more than 20% in the past year.


Management Age and Tenure

4.0yrs

Average Tenure

53.5yo

Average Age

Experienced Management: GIS's management team is considered experienced (4 years average tenure).


Board Age and Tenure

3.8yrs

Average Tenure

61yo

Average Age

Experienced Board: GIS's board of directors are considered experienced (3.8 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

SellUS$239,63104 Apr 19
John Church
EntityIndividual
Role
Senior Key Executive
Chief Supply Chain Officer & Global Business Solutions Officer
Shares4,719
Max PriceUS$50.78
SellUS$347,37605 Feb 19
Ronal Clark
EntityIndividual
Role
Lead Director
Independent Lead Director
Shares7,849
Max PriceUS$44.26

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 2.6%.


Management Team

  • Don Mulligan (58yo)

    Chief Financial Officer

    • Tenure: 12.4yrs
    • Compensation: US$4.00m
  • Jeff Harmening (52yo)

    Chairman & CEO

    • Tenure: 2.6yrs
    • Compensation: US$9.86m
  • John Church (53yo)

    Chief Supply Chain Officer & Global Business Solutions Officer

    • Tenure: 11.8yrs
    • Compensation: US$3.18m
  • Jano Cabrera (44yo)

    Chief Communications Officer

    • Tenure: 0.4yrs
  • Jon Nudi (49yo)

    Group President of North America Retail

    • Tenure: 3yrs
    • Compensation: US$4.43m
  • Richard Allendorf (58yo)

    Senior VP

    • Tenure: 4.9yrs
    • Compensation: US$2.88m
  • Marie Pillai

    Chief Investment Officer

    • Tenure: 11yrs
  • Ivan Pollard (56yo)

    Global Chief Marketing Officer

    • Tenure: 2.5yrs
  • Jeff Siemon

    Vice President of Investor Relations

    • Jodi Benson (54yo)

      Senior VP


      Board Members

      • David Cordani (54yo)

        Independent Director

        • Tenure: 5.2yrs
        • Compensation: US$279.98k
      • Maria Sastre (64yo)

        Independent Director

        • Tenure: 1.6yrs
        • Compensation: US$254.98k
      • Steve Odland (60yo)

        Independent Director

        • Tenure: 15.3yrs
        • Compensation: US$269.98k
      • Eric Sprunk (55yo)

        Independent Director

        • Tenure: 4.1yrs
        • Compensation: US$259.98k
      • Diane Neal (62yo)

        Independent Director

        • Tenure: 1.2yrs
        • Compensation: US$236.25k
      • Maria G. Henry (52yo)

        Independent Director

        • Tenure: 3.6yrs
        • Compensation: US$271.23k
      • Jorge Uribe (63yo)

        Independent Director

        • Tenure: 3.6yrs
        • Compensation: US$254.98k
      • Roger Ferguson (68yo)

        Independent Director

        • Tenure: 4.1yrs
        • Compensation: US$269.98k
      • Ronal Clark (66yo)

        Independent Lead Director

        • Tenure: 4.1yrs
        • Compensation: US$284.98k
      • Jeff Harmening (52yo)

        Chairman & CEO

        • Tenure: 2.6yrs
        • Compensation: US$9.86m

      Company Information

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


      Key Information

      • Name: General Mills, Inc.
      • Ticker: GIS
      • Exchange: NYSE
      • Founded: 1866
      • Industry: Packaged Foods and Meats
      • Sector: Food, Beverage & Tobacco
      • Market Cap: US$32.569b
      • Shares outstanding: 604.82m
      • Website: https://www.generalmills.com

      Number of Employees


      Location

      • General Mills, Inc.
      • Number One General Mills Boulevard
      • Minneapolis
      • Minnesota
      • 55426
      • United States

      Listings

      TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
      GISNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
      GRMDB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
      GRMXTRA (XETRA Trading Platform)YesCommon StockDEEURJan 1968
      GISSWX (SIX Swiss Exchange)YesCommon StockCHCHFJan 1968
      0R1XLSE (London Stock Exchange)YesCommon StockGBUSDJan 1968
      GISWBAG (Wiener Boerse AG)YesCommon StockATEURJan 1968
      GRMETLX (Eurotlx)YesCommon StockITEURJan 1968
      GIS *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJan 1968

      Biography

      General Mills, Inc. manufactures and markets branded consumer foods worldwide. The company operates in five segments: North America Retail; Convenience Stores & Foodservice; Europe & Australia; Asia & Latin America; and Pet. It offers ready-to-eat cereals, refrigerated yogurt, soup, meal kits, refrigerated and frozen dough products, dessert and baking mixes, frozen pizza and pizza snacks, grain, fruit, and savory snacks, as well as organic products, including refrigerated yogurt, nutrition bars, meal kits, salty snacks, ready-to-eat cereal, and grain snacks. It also supplies branded and unbranded food products to the North American foodservice and commercial baking industries; and manufactures and markets pet food products, including dog and cat food. The company markets its products under the Annie’s, Betty Crocker, Bisquick, Blue Buffalo, BLUE Basics, BLUE Freedom, BLUE Wilderness, Bugles, Cascadian Farm, Cheerios, Chex, Cinnamon Toast Crunch, Cocoa Puffs, Cookie Crisp, EPIC, Fiber One, Food Should Taste Good, Fruit by the Foot, Fruit Gushers, Fruit Roll-Ups, Gardetto’s, Go-Gurt, Gold Medal, Golden Grahams, Häagen-Dazs, Helpers, Jeno’s, Jus-Rol, Kitano, Kix, Lärabar, Latina, Liberté, Lucky Charms, Muir Glen, Nature Valley, Oatmeal Crisp, Old El Paso, Pillsbury, Progresso, Raisin Nut Bran, Total, Totino’s, Trix, Wanchai Ferry, Wheaties, Yoki, and Yoplait trademarks. General Mills, Inc. sells its products directly, as well as through broker and distribution arrangements to grocery stores, mass merchandisers, membership stores, natural food chains, e-commerce retailers, commercial and noncommercial foodservice distributors and operators, restaurants, convenience stores, and pet specialty stores, as well as drug, dollar, and discount chains. It operates 525 leased and 365 franchise branded ice cream parlors. General Mills, Inc. was founded in 1866 and is headquartered in Minneapolis, Minnesota. 


      Company Analysis and Financial Data Status

      All financial data provided by Standard & Poor's Capital IQ.
      DataLast Updated (UTC time)
      Company Analysis2020/01/18 23:35
      End of Day Share Price2020/01/17 00:00
      Earnings2019/11/24
      Annual Earnings2019/05/26


      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.