Freshpet, Inc. (NASDAQ: FRPT)

Sector: Consumer Defensive Industry: Packaged Foods CIK: 0001611647
Market Cap 3.48 Bn
P/B 2.96
P/E 28.22
P/S 3.23
ROIC (Qtr) 13.39
Div Yield % 0.00
Rev 1y % (Qtr) 14.00
Total Debt (Qtr) 494.81 Mn
Debt/Equity (Qtr) 0.42
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About

Freshpet, Inc., a company operating in the pet food industry, has made significant strides since its inception in 2004. Based in Secaucus, New Jersey, Freshpet is dedicated to providing high-quality, fresh food for dogs and cats, aiming to cater to the nutritional requirements of pets while being mindful of the planet's wellbeing. The company's core business activities revolve around the production, marketing, and distribution of pet food and treats. Freshpet's innovative approach involves utilizing natural and fresh ingredients, creating products...

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Investment thesis

Bull case

  • Healthy cash reserves of 274.59M provide 62.11x coverage of short-term debt 4.42M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 155.82M provides exceptional 10.91x coverage of interest expenses 14.29M, showing strong debt service capability.
  • Strong tangible asset base of 1.75B provides 3.53x coverage of total debt 494.81M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 155.82M provides solid 2.03x coverage of current liabilities 76.75M, showing strong operational health.
  • Robust tangible asset base of 1.75B provides 5.03x coverage of working capital 346.80M, indicating strong operational backing.

Bear case

  • Operating cash flow of 155.82M barely covers its investment activities of (153.40M), with a coverage ratio of -1.02, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • The company's operating cash flow of 155.82M shows concerning coverage of stock compensation expenses of 34.20M, with a 4.56 ratio indicating potential earnings quality issues.
  • Operating cash flow of 155.82M provides minimal -2.01x coverage of tax expenses of (77.49M), suggesting potential tax planning inefficiencies or unsustainable tax positions.
  • Free cash flow of 2.43M provides weak coverage of capital expenditures of 153.40M, with a 0.02 ratio suggesting additional external financing needs for growth initiatives.
  • Operating earnings of 60.24M show weak coverage of depreciation charges of 88.16M, with a 0.68 ratio indicating high capital intensity and potential reinvestment needs.

Contract with Customer, Sales Channel Breakdown of Revenue (2024)

Segments Breakdown of Revenue (2024)

Peer comparison

Companies in the Packaged Foods
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 KHC Kraft Heinz Co 28.20 Bn -4.82 1.13 21.22 Bn
2 GIS General Mills Inc 26.99 Bn 20.72 1.54 13.73 Bn
3 JBS Jbs N.V. 17.81 Bn 10.08 0.23 23.92 Bn
4 MKC Mccormick & Co Inc 16.10 Bn 44.21 3.77 4.00 Bn
5 HRL Hormel Foods Corp /De/ 12.37 Bn 18.03 1.34 2.86 Bn
6 SJM J M SMUCKER Co 11.08 Bn 19.60 1.97 7.91 Bn
7 PPC Pilgrims Pride Corp 10.32 Bn 9.54 0.56 3.29 Bn
8 MICC Magnum Ice Cream Co N.V. 9.71 Bn 28.17 1.04 4.02 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 2.14 1.47
EV to Cash from Ops. EV/CFO 23.97 29.75
EV to Debt EV to Debt 7.55 27.85
EV to EBIT EV/EBIT 62.01 86.88
EV to EBITDA EV/EBITDA 26.92 -156.20
EV to Free Cash Flow [EV/FCF] EV/FCF 1,539.82 -5.67
EV to Market Cap EV to Market Cap 1.07 1.15
EV to Revenue EV/Rev 3.46 7.32
Price to Book Value [P/B] P/B 2.96 8.48
Price to Earnings [P/E] P/E 28.22 14.45
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 4.58
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 3.76
Dividend per Basic Share Div per Share (Qtr) 0.00 0.65
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 22.76
Interest Coverage Int. cover (Qtr) 4.22 6.64
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 25.64 -118.07
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 0.00 43.48
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 0.66
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 187.78 -48.16
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 40.37 -152.35
EBIT Growth (1y) % EBIT 1y % (Qtr) 6.74 -50.79
EBT Growth (1y) % EBT 1y % (Qtr) 3.84 -54.94
EPS Growth (1y) % EPS 1y % (Qtr) 176.09 -28.10
FCF Growth (1y) % FCF 1y % (Qtr) 103.71 7.02
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 21.96 439.70
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.62 1.01
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.12
Cash Ratio Cash Ratio (Qtr) 3.58 0.86
Current Ratio Curr Ratio (Qtr) 5.52 2.60
Debt to Equity Ratio Debt/Equity (Qtr) 0.42 2.21
Interest Cover Ratio Int Coverage (Qtr) 4.22 6.64
Times Interest Earned Times Interest Earned (Qtr) 4.22 6.64
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 13.70 -919.13
EBIT Margin % EBIT Margin % (Qtr) 5.58 -1,474.87
EBT Margin % EBT Margin % (Qtr) 4.26 -1,537.76
Gross Margin % Gross Margin % (Qtr) 40.60 26.98
Net Profit Margin % Net Margin % (Qtr) 11.40 -1,538.60