Local Bounti (NYSE:LOCL) - Share price, News & Analysis

Q: What is the Fair Price of LOCL when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

LOCL ($2.84) is trading below our estimate of [[fair value]] ($321.49)

LOCL fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	6/6
Past Performance	0/6
Financial Health	1/6
Dividends	0/6

LOCL Stock Overview

Local Bounti Corporation grows fresh greens and herbs in the United States.

Rewards

Trading at 99.1% below our estimate of its fair value

Earnings are forecast to grow 75.04% per year

Revenue grew by 2743.7% over the past year

Risk Analysis

Has less than 1 year of cash runway

Shareholders have been substantially diluted in the past year

Volatile share price over the past 3 months

Significant insider selling over the past 3 months

Local Bounti Competitors

AppHarvest

NasdaqGS:APPH

US$208.6m

Limoneira

NasdaqGS:LMNR

US$233.6m

Alico

NasdaqGS:ALCO

US$214.3m

Village Farms International

NasdaqCM:VFF

US$169.2m

Price History & Performance

Summary of all time highs, changes and price drops for Local Bounti
Historical stock prices
Current Share Price	US$2.84
52 Week High	US$12.87
52 Week Low	US$2.22
Beta	0
1 Month Change	-23.66%
3 Month Change	-12.07%
1 Year Change	-71.46%
3 Year Change	n/a
5 Year Change	n/a
Change since IPO	-70.87%

Recent News & Updates

Aug 15

Local Bounti reports mixed Q2 earnings; reaffirms FY22 guidance

Local Bounti press release (NYSE:LOCL): Q2 GAAP EPS of -$0.36 misses by $0.15. Revenue of $6.3M (+5627.3% Y/Y) beats by $0.44M. Adjusted EBITDA loss was $7.9M. Management is reaffirming its full year 2022 sales guidance of at least $20 million vs. consensus of $21.58M, including partial year contribution from its acquisition of Pete's which closed on April 4, 2022.

Shareholder Returns

	LOCL	US Food	US Market
7D	25.7%	-3.4%	-2.5%
1Y	-71.5%	-1.5%	-23.2%

Return vs Industry: LOCL underperformed the US Food industry which returned 0.2% over the past year.

Return vs Market: LOCL underperformed the US Market which returned -21.5% over the past year.

Price Volatility

Is LOCL's price volatile compared to industry and market?
LOCL volatility
LOCL Average Weekly Movement	14.5%
Food Industry Average Movement	5.4%
Market Average Movement	6.9%
10% most volatile stocks in US Market	15.6%
10% least volatile stocks in US Market	2.8%

Stable Share Price: LOCL is more volatile than 75% of US stocks over the past 3 months, typically moving +/- 14% a week.

Volatility Over Time: LOCL's weekly volatility (14%) has been stable over the past year, but is still higher than 75% of US stocks.

About the Company

Founded	Employees	CEO	Website
2018	111	Craig Hurlbert	https://localbounti.com

Local Bounti Corporation grows fresh greens and herbs in the United States. It produces lettuce, herbs, and loose-leaf lettuce. The company sells its products to food retailers and food service distributors.

Local Bounti Fundamentals Summary

How do Local Bounti's earnings and revenue compare to its market cap?
LOCL fundamental statistics
Market Cap	US$267.55m
Earnings (TTM)	-US$96.54m
Revenue (TTM)	US$7.02m

38.1x

P/S Ratio

-2.8x

P/E Ratio

Is LOCL overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
LOCL income statement (TTM)
Revenue	US$7.02m
Cost of Revenue	US$5.78m
Gross Profit	US$1.24m
Other Expenses	US$97.78m
Earnings	-US$96.54m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	-1.02
Gross Margin	17.65%
Net Profit Margin	-1,374.43%
Debt/Equity Ratio	77.7%

How did LOCL perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is LOCL undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Price-To-Sales vs Peers
Price-To-Sales vs Industry
Price-To-Sales vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for LOCL?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for LOCL. This is calculated by dividing LOCL's market cap by their current preferred multiple.
What is LOCL's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$267.55m

LOCL key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	51.9x
Enterprise Value/EBITDA	-5x
PEG Ratio	n/a

Price to Sales Ratio vs Peers

How does LOCL's PS Ratio compare to its peers?

LOCL PS Ratio vs Peers

The above table shows the PS ratio for LOCL vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PS	Estimated Growth	Market Cap
Peer Average	5x
APPH AppHarvest	15.9x	52.5%	US$208.6m
LMNR Limoneira	1.3x	5.1%	US$233.6m
ALCO Alico	2.3x	9.0%	US$214.3m
VFF Village Farms International	0.6x	16.4%	US$169.2m
LOCL Local Bounti	38.1x	87.3%	US$267.6m

Price-To-Sales vs Peers: LOCL is expensive based on its Price-To-Sales Ratio (38.1x) compared to the peer average (5x).

Price to Earnings Ratio vs Industry

How does LOCL's PE Ratio compare vs other companies in the US Food Industry?

Price-To-Sales vs Industry: LOCL is expensive based on its Price-To-Sales Ratio (38.1x) compared to the US Food industry average (1.1x)

Price to Sales Ratio vs Fair Ratio

What is LOCL's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

LOCL PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio	38.1x
Fair PS Ratio	22.7x

Price-To-Sales vs Fair Ratio: LOCL is expensive based on its Price-To-Sales Ratio (38.1x) compared to the estimated Fair Price-To-Sales Ratio (22.7x).

Share Price vs Fair Value

What is the Fair Price of LOCL when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: LOCL ($2.84) is trading below our estimate of fair value ($321.49)

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

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.

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Future Growth

How is Local Bounti forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

Future Growth Score

6/6

Future Growth Score 6/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

75.0%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: LOCL is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.9%).

Earnings vs Market: LOCL is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: LOCL is expected to become profitable in the next 3 years.

Revenue vs Market: LOCL's revenue (87.3% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: LOCL's revenue (87.3% per year) is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: LOCL's Return on Equity is forecast to be high in 3 years time (39%)

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Past Performance

How has Local Bounti performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-332.9%

Last years earnings growth

Earnings and Revenue History

Quality Earnings: LOCL is currently unprofitable.

Growing Profit Margin: LOCL is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if LOCL's year-on-year earnings growth rate was positive over the past 5 years.

Accelerating Growth: Unable to compare LOCL's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: LOCL is unprofitable, making it difficult to compare its past year earnings growth to the Food industry (0.3%).

Return on Equity

High ROE: LOCL has a negative Return on Equity (-71.28%), as it is currently unprofitable.

Discover strong past performing companies

Financial Health

How is Local Bounti's financial position?

Financial Health Score

1/6

Financial Health Score 1/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Stable Cash Runway
Forecast Cash Runway

Financial Position Analysis

Short Term Liabilities: LOCL's short term assets ($50.2M) exceed its short term liabilities ($9.5M).

Long Term Liabilities: LOCL's short term assets ($50.2M) do not cover its long term liabilities ($119.5M).

Debt to Equity History and Analysis

Debt Level: LOCL's net debt to equity ratio (60.9%) is considered high.

Reducing Debt: Insufficient data to determine if LOCL's debt to equity ratio has reduced over the past 5 years.

Balance Sheet

Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: LOCL has less than a year of cash runway based on its current free cash flow.

Forecast Cash Runway: LOCL has less than a year of cash runway if free cash flow continues to reduce at historical rates of 104.9% each year

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Dividend

What is Local Bounti current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

Dividend Yield vs Market

Local Bounti Dividend Yield vs Market

How does Local Bounti dividend yield compare to the market?
Segment	Dividend Yield
Company (Local Bounti)	n/a
Market Bottom 25% (US)	1.7%
Market Top 25% (US)	4.7%
Industry Average (Food)	2.8%
Analyst forecast in 3 Years (Local Bounti)	0%

Notable Dividend: Unable to evaluate LOCL's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate LOCL's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if LOCL's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if LOCL's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as LOCL has not reported any payouts.

Discover strong dividend paying companies

Management

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

1.3yrs

Average management tenure

CEO

Craig Hurlbert (58 yo)

0.83yr

Tenure

US$190,618

Compensation

Mr. Craig M. Hurlbert serves as the Managing Partner at BrightMark Partners. He has been the Chairman of TAS Energy Inc. (also known as, Turbine Air Systems (TAS), Ltd.) since April 2008 and served as its...

CEO Compensation Analysis

Craig Hurlbert's Compensation vs Local Bounti Earnings

How has Craig Hurlbert's remuneration changed compared to Local Bounti's earnings?
Date	Total Comp.	Salary	Company Earnings
Jun 30 2022	n/a	n/a	-US$97m
Mar 31 2022	n/a	n/a	-US$72m
Dec 31 2021	US$191k	US$173k	-US$56m
Sep 30 2021	n/a	n/a	-US$31m
Jun 30 2021	n/a	n/a	-US$22m
Mar 31 2021	n/a	n/a	-US$16m
Dec 31 2020	US$314k	n/a	-US$8m

Compensation vs Market: Craig's total compensation ($USD190.62K) is below average for companies of similar size in the US market ($USD1.72M).

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

Leadership Team

Experienced Management: LOCL's management team is not considered experienced ( 1.3 years average tenure), which suggests a new team.

Board Members

Experienced Board: LOCL's board of directors are not considered experienced ( 0.8 years average tenure), which suggests a new board.

Ownership

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

Insider Trading Volume

Insider Buying: LOCL insiders have only sold shares in the past 3 months.

Recent Insider Transactions

NYSE:LOCL Recent Insider Transactions by Companies or Individuals
Date	Value	Name	Entity	Shares	Max Price
02 Sep 22	SellUS$54,948	Mark McKinney	Individual	15,276	US$3.60
04 Jan 22	BuyUS$137,416	Charles Schwab	Individual	19,000	US$7.24
07 Dec 21	BuyUS$13,800	Gary Hilberg	Individual	2,000	US$6.90
07 Dec 21	BuyUS$284,568	Travis Joyner	Individual	41,974	US$6.96
03 Dec 21	BuyUS$7,482	B. Vosburg	Individual	1,160	US$6.45
03 Dec 21	BuyUS$765,013	Craig Hurlbert	Individual	112,107	US$6.86
02 Dec 21	BuyUS$49,130	Matthew Nordby	Individual	7,000	US$7.02
02 Dec 21	BuyUS$310,087	Mark McKinney	Individual	46,455	US$6.68
02 Dec 21	BuyUS$34,344	Gary Hilberg	Individual	5,000	US$6.87
02 Dec 21	BuyUS$6,409	Charles Schwab	Individual	1,000	US$6.41
02 Dec 21	BuyUS$100,000	Kathleen Valiasek	Individual	15,746.03	US$6.35

Ownership Breakdown

What is the ownership structure of LOCL?
Owner Type	Number of Shares	Ownership Percentage
Private Companies	6,770,000	7.2%
Institutions	13,673,392	14.5%
General Public	22,549,241	23.9%
Individual Insiders	51,215,277	54.4%

Dilution of Shares: Shareholders have been substantially diluted in the past year, with total shares outstanding growing by 174.1%.

Top Shareholders

Top 25 shareholders own 75.14% of the company

Ownership	Name	Shares	Current Value	Change %	Portfolio %
19.28%	Craig Hurlbert	18,165,931	$51.6m	0.02%	no data
17.26%	Travis Joyner	16,264,475	$46.2m	0.45%	no data
12.55%	Charles Schwab	11,825,173	$33.6m	0%	no data
7.19%	Leo Investors III LP	6,770,000	$19.2m	0%	no data
6.5%	FMR LLC	6,123,862	$17.4m	0.93%	no data
1.63%	Pamela Brewster	1,532,234	$4.4m	0.33%	no data
1.47%	The Vanguard Group, Inc.	1,381,196	$3.9m	8.24%	no data
1.29%	BlackRock, Inc.	1,216,986	$3.5m	239.27%	no data
1.28%	B. Vosburg	1,207,428	$3.4m	0%	no data
1.17%	Kathleen Valiasek	1,105,898	$3.1m	3.24%	no data
0.85%	BNPP Asset Management Holding	804,562	$2.3m	27.07%	no data
0.64%	The de Burlo Group, Inc.	603,134	$1.7m	0%	0.43%
0.64%	Main Street Research LLC	603,134	$1.7m	0%	0.39%
0.63%	Allianz Asset Management AG	593,475	$1.7m	-0.56%	no data
0.63%	State Street Global Advisors, Inc.	592,076	$1.7m	1075.34%	no data
0.44%	Geode Capital Management, LLC	413,245	$1.2m	167.56%	no data
0.4%	Edward Forst	374,489	$1.1m	0%	no data
0.34%	Gary Hilberg	319,568	$907.6k	3.57%	no data
0.19%	Northern Trust Global Investments	182,790	$519.1k	253.94%	no data
0.19%	Mark McKinney	181,179	$514.5k	290.01%	no data
0.13%	Strategic Advisers LLC	125,588	$356.7k	0%	no data
0.13%	Brian Cook	124,735	$354.2k	0%	no data
0.11%	Mark Nelson	107,167	$304.4k	-0.04%	no data
0.095%	Alyeska Investment Group, L.P.	89,239	$253.4k	0%	no data
0.09%	Rafferty Asset Management, LLC	84,417	$239.7k	0%	no data

Data	Last Updated (UTC time)
Company Analysis	2022/09/30 00:00
End of Day Share Price	2022/09/30 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31