Brown Forman Stock Analysis, Valuation (NYSE:BF.A)
Take a look at Amigobulls Brown Forman stock analysis video. This video puts forward our latest analysis highlighting the pros and cons for BF.A stock.
Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.
Brown-Forman Corporation Stock Rating 3/5
Amigobulls BF.A stock analysis relies on business fundamentals such as Brown Forman revenue growth, profits and return on equity measures from the latest quarter 2018 Q4 earnings. We also use relative valuation metrics like PE ratio and price to sales ratio for Brown Forman valuation analysis. Brown Forman stock rating is our opinion about the business fundamentals of the company.
Should you buy BF.A stock?
- Brown Forman had a healthy average operating margin of 26.08 over the last 4 quarters.
- Net margins came in at average 18% for Brown Forman over the last twelve months.
- Brown Forman has an attractive ROIC (Return on Invested Capital) of 19.8
- Brown Forman has a good Return On Equity (ROE) of 51.6.
Should you sell BF.A stock?
- Brown Forman revenue saw a decline of -17.4% YoY in 2018-04.
- Long term revenue growth of 1 over the past 5 years has been disappointing.
- Brown Forman is debt laden and has a high debt/equity ratio of 1.94.
- Cash flow from operations is low at 0.6364 times the net income.
- BF.A stock is trading at a PE ratio of 34.5, which is worse than the sector average multiple of 21.7.
- BF.A stock is trading at a PS multiple of 6.4, which is a negative when compared to the Consumer Staples sector average multiple of 1.7.
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Investors can use Amigobulls Brown Forman stock analysis as a tool to arrive at accurate conclusions regarding financial health of the company and its valuation. Fundamental analysis of a company is the most often used approach to find the intrinsic value of a stock.
While doing a study of the company financials, Brown Forman revenue growth and profit or net income are two main metrics which help in identifying whether BF.A stock is overvalued or undervalued. Technical analysis comes in handy to check whether the market sentiment is in line with the fundamental picture of the company.