Brown Forman Stock Analysis, Valuation (NYSE:BF.B)

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$54.32 $0.07 (0.13%) BF.B stock closing price Sep 20, 2017 (Closing)
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Brown Forman
Updated on : Sep 20, 2017
previous close
BF.B 54.3 (0%)
S&P 500 2508.2 (0%)
Closing Price On: Sep 20, 2017
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Beverages-Alcoholic
Sector :
Consumer Staples
5 Quarter Revenue
Revenue Growth
2018-Q1
$million
%
YOY GROWTH
Compared to the industry
Long Term Growth
5 Year CAGR:
0.4%
Operating Profit
Operating Margin:
27.4%
Sector Average:
10.8%
5 Quarter Net Profit
Net Margins
2018-Q1
%
LTM Margin
Compared to the industry
Debt/Equity Ratio
Debt:
2.23B
Debt/Equity Ratio:
 1.57
Compared to the industry
Cash Flow
Operating cash flow:
$102M
Net Income:
$178M
Dividend Yield
BF.B dividend yield:
1.31%
PROS      CONS
Operating Margins
Net Margins
ROIC
ROE
FCF Margin
Recent Growth
Long Term Growth
High Debt Burden
Cash Flow
PE Valuation
PS Valuation
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
BF.B PS :
5.6
Industry PS :
1.6
Sector:   Consumer Staples.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
20%
Return on Equity:
53.2%
Free Cash Flow Margin:
10.2%
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Brown Forman Stock Analysis

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View Brown Forman stock analysis video. This is our analyst opinion covering the buy and sell arguments for BF.B stock.

Brown-Forman Corporation Stock Rating 3.1/5

Our Brown Forman stock opinion is based on fundamentals of the company. This Brown Forman stock analysis is based on latest 2018 Q1 earnings. The stock price analysis takes into account the company's valuation metrics.

Should you buy BF.B stock?

  • Brown Forman's average operating margin of 27.4% was exceptional.
  • LTM Net margins were good at 18.8% for Brown Forman.
  • Brown Forman has an attractive ROIC (Return on Invested Capital) of 20%
  • Brown Forman has a good Return On Equity (ROE) of 53.2%.
  • The company has a good Free Cash Flow (FCF) margin of 10.2%.

Should you sell BF.B stock?

  • Brown Forman sales shrank by -15.5% year-over-year in 2018 Q1.
  • Revenue growth of 0.4% has been weak over the last 5 years.
  • Brown Forman has a debt/equity ratio of  1.57, which is worse than the average in the Consumer Staples sector.
  • Cash flow from operations is 0.6 times net income which is a negative signal.
  • BF.B stock is trading at a PE ratio of 30, which is worse than the industry average multiple of 22.5.
  • The company is trading at a price to sales multiple of 5.6, which is higher in comparison to the Beverages-Alcoholic industry average of 1.6, making BF.B stock expensive.

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