NasdaqGS:CENT

Stock Analysis Report

Executive Summary

Central Garden & Pet Company, together with its subsidiaries, produces and distributes products for the lawn and garden, and pet supplies markets in the United States.

Rewards

Trading at 9.9% below its fair value

Earnings are forecast to grow 2.77% per year

Risk Analysis

Has a high level of debt

Profit margins (3.9%) are lower than last year (5.6%)

Shareholders have been diluted in the past year



Snowflake Analysis

Excellent balance sheet and good value.


Similar Companies

Church & Dwight

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Share Price & News

How has Central Garden & Pet's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

6.4%

CENT

1.7%

US Household Products

0.03%

US Market


1 Year Return

-15.0%

CENT

28.9%

US Household Products

18.6%

US Market

Return vs Industry: CENT underperformed the US Household Products industry which returned 28.9% over the past year.

Return vs Market: CENT underperformed the US Market which returned 18.6% over the past year.


Shareholder returns

CENTIndustryMarket
7 Day6.4%1.7%0.03%
30 Day-9.5%4.0%1.7%
90 Day4.4%0.5%5.7%
1 Year-15.0%-15.0%32.3%28.9%21.1%18.6%
3 Year-13.5%-13.5%57.8%44.5%45.6%36.2%
5 Year262.7%262.7%63.8%40.9%71.1%52.3%

Price Volatility Vs. Market

How volatile is Central Garden & Pet's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Central Garden & Pet undervalued compared to its fair value and its price relative to the market?

9.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CENT ($28.07) is trading below our estimate of fair value ($31.16)

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


Price To Earnings Ratio

PE vs Industry: CENT is good value based on its PE Ratio (17.2x) compared to the Household Products industry average (26x).

PE vs Market: CENT is good value based on its PE Ratio (17.2x) compared to the US market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: CENT is poor value based on its PEG Ratio (6.2x)


Price to Book Ratio

PB vs Industry: CENT is good value based on its PB Ratio (1.6x) compared to the US Household Products industry average (4.3x).


Next Steps

Future Growth

How is Central Garden & Pet forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

2.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CENT's forecast earnings growth (2.8% per year) is above the savings rate (1.7%).

Earnings vs Market: CENT's earnings (2.8% per year) are forecast to grow slower than the US market (14.2% per year).

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

Revenue vs Market: CENT's revenue (2% per year) is forecast to grow slower than the US market (7.4% per year).

High Growth Revenue: CENT's revenue (2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CENT's Return on Equity is forecast to be low in 3 years time (8.6%).


Next Steps

Past Performance

How has Central Garden & Pet performed over the past 5 years?

33.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CENT has high quality earnings.

Growing Profit Margin: CENT's current net profit margins (3.9%) are lower than last year (5.6%).


Past Earnings Growth Analysis

Earnings Trend: CENT's earnings have grown significantly by 33.4% per year over the past 5 years.

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

Earnings vs Industry: CENT had negative earnings growth (-24.9%) over the past year, making it difficult to compare to the Household Products industry average (-20%).


Return on Equity

High ROE: CENT's Return on Equity (9.3%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Central Garden & Pet's financial position?


Financial Position Analysis

Short Term Liabilities: CENT's short term assets ($1.3B) exceed its short term liabilities ($278.5M).

Long Term Liabilities: CENT's short term assets ($1.3B) exceed its long term liabilities ($750.3M).


Debt to Equity History and Analysis

Debt Level: CENT's debt to equity ratio (69.6%) is considered high.

Reducing Debt: CENT's debt to equity ratio has reduced from 92.6% to 69.6% over the past 5 years.

Debt Coverage: CENT's debt is well covered by operating cash flow (29.6%).

Interest Coverage: CENT's interest payments on its debt are well covered by EBIT (4.7x coverage).


Balance Sheet

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

Debt Coverage by Assets: CENT's debt is covered by short term assets (assets are 1.9x debt).


Next Steps

Dividend

What is Central Garden & Pet's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage2.4%forecastin3Years0%

Current dividend yield vs market & industry

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

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


Stability and Growth of Payments

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

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


Current Payout to Shareholders

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


Future Payout to Shareholders

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


Next Steps

Management

What is the CEO of Central Garden & Pet's salary, the management and board of directors tenure and is there insider trading?

5.7yrs

Average management tenure


CEO

Tim Cofer (50yo)

0.2yrs

Tenure

0

Mr. Timothy P. Cofer, also known as Tim, has been the Chief Executive officer of Central Garden & Pet Company since October 2019 and has been its Director since September 28, 2019. Mr. Cofer served as the  ...


Management Age and Tenure

5.7yrs

Average Tenure

62yo

Average Age

Experienced Management: CENT's management team is seasoned and experienced (5.7 years average tenure).


Board Age and Tenure

2.0yrs

Average Tenure

63.5yo

Average Age

Experienced Board: CENT's board of directors are not considered experienced ( 2 years average tenure), which suggests a new board.


Insider Trading

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


Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 9.8%.


Management Team

  • Sonny Pennington (65yo)

    Director of Special Projects & Director

    • Tenure: 21.9yrs
    • Compensation: US$402.19k
  • Jim Heim (65yo)

    President of Business Development for Pet

    • Tenure: 10.9yrs
    • Compensation: US$566.13k
  • Kay Schwichtenberg (67yo)

    Executive Vice President of Animal & Public Health

    • Tenure: 5.7yrs
    • Compensation: US$509.45k
  • Steve Zenker

    Vice President of Finance - Investor Relations

    • Tenure: 0yrs
  • Howard Machek (56yo)

    Senior VP & Chief Accounting Officer

    • Tenure: 0yrs
    • Compensation: US$643.95k
  • Niko Lahanas (50yo)

    Chief Financial Officer

    • Tenure: 2.6yrs
    • Compensation: US$534.25k
  • Tim Cofer (50yo)

    CEO & Director

    • Tenure: 0.2yrs
  • George Yuhas (67yo)

    General Counsel & Corporate Secretary

    • Tenure: 8.8yrs
    • Compensation: US$597.77k
  • Chris Walter

    Chief Information Officer

    • Tenure: 8.1yrs
  • Bill Lynch (59yo)

    Senior Vice President of Operations

    • Tenure: 3.2yrs
    • Compensation: US$653.32k

Board Members

  • Mike Edwards (58yo)

    Independent Director

    • Tenure: 2yrs
    • Compensation: US$177.97k
  • Chris Metz (54yo)

    Independent Director

    • Tenure: 0.8yrs
  • Bill Brown (78yo)

    Chairman of the Board

    • Tenure: 0.3yrs
    • Compensation: US$514.58k
  • Sonny Pennington (65yo)

    Director of Special Projects & Director

    • Tenure: 21.9yrs
    • Compensation: US$402.19k
  • Jack Balousek (73yo)

    Lead Independent Director

    • Tenure: 0yrs
    • Compensation: US$221.47k
  • Mary Springer (55yo)

    Independent Director

    • Tenure: 6.9yrs
    • Compensation: US$176.47k
  • Thomas Colligan (75yo)

    Independent Director

    • Tenure: 4.8yrs
    • Compensation: US$183.47k
  • John Ranelli (73yo)

    Director

    • Tenure: 9.7yrs
    • Compensation: US$303.47k
  • Mike Griffith (62yo)

    Independent Director

    • Tenure: 0.5yrs
  • Tim Cofer (50yo)

    CEO & Director

    • Tenure: 0.2yrs

Company Information

Central Garden & Pet Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Central Garden & Pet Company
  • Ticker: CENT
  • Exchange: NasdaqGS
  • Founded: 1955
  • Industry: Household Products
  • Sector: Household
  • Market Cap: US$1.474b
  • Shares outstanding: 55.93m
  • Website: https://www.central.com

Number of Employees


Location

  • Central Garden & Pet Company
  • 1340 Treat Boulevard
  • Suite 600
  • Walnut Creek
  • California
  • 94597
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CENTNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJul 1992
GP7DB (Deutsche Boerse AG)YesCommon StockDEEURJul 1992
CENT.ANasdaqGS (Nasdaq Global Select)Class A Common StockUSUSDFeb 2007
GP7ADB (Deutsche Boerse AG)Class A Common StockDEEURFeb 2007

Biography

Central Garden & Pet Company, together with its subsidiaries, produces and distributes products for the lawn and garden, and pet supplies markets in the United States. It operates through two segments, Pet ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/07 23:33
End of Day Share Price2019/12/06 00:00
Earnings2019/09/28
Annual Earnings2019/09/28


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.