Lifetime Brands, Inc (NASDAQ: LCUT)

Sector: Consumer Cyclical Industry: Furnishings, Fixtures & Appliances CIK: 0000874396
Market Cap 65.12 Mn
P/B 0.24
P/E -5.39
P/S 0.11
ROIC (Qtr) 2.29
Div Yield % 6.46
Rev 1y % (Qtr) -6.49
Total Debt (Qtr) 257.03 Mn
Debt/Equity (Qtr) 1.39
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About

Lifetime Brands, Inc., often recognized by its ticker symbol LCUT, is a major player in the home goods industry, specializing in the design, production, and distribution of kitchenware, tableware, and other household items. The company's operations are spread across various countries, with a significant international presence through its subsidiaries and affiliate companies. Lifetime Brands' revenue is primarily generated from the sale of its products, which are predominantly marketed under its own brands. These brands include Farberware, KitchenAid,...

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Investment thesis

Bull case

  • Robust free cash flow of 20.43M exceeds capital expenditure of 3.75M by 5.45x, indicating strong organic growth funding capability.
  • Tangible assets of 443.85M provide robust 6.58x coverage of other current liabilities 67.50M, indicating strong asset backing.
  • Operating cash flow of 24.18M fully covers other non-current liabilities 22.17M by 1.09x, showing strong long-term stability.
  • Operating cash flow of 24.18M provides strong 3.75x coverage of tax liabilities 6.45M, showing excellent fiscal position.
  • Strong tangible asset base of 443.85M provides 3.23x coverage of intangibles 137.27M, indicating robust asset quality.

Bear case

  • Operating cash flow of 24.18M barely covers its investment activities of (3.75M), with a coverage ratio of -6.45, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • With cash reserves of 12.12M against inventory of 221.19M, the 0.05 cash-to-inventory ratio suggests potential liquidity risks if inventory turnover slows, particularly concerning given current supply chain volatilities.
  • Operating cash flow of 24.18M provides thin coverage of dividend payments of (3.77M) with a -6.41 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Operating earnings of (13.98M) show weak coverage of depreciation charges of 22.61M, with a -0.62 ratio indicating high capital intensity and potential reinvestment needs.
  • Free cash flow of 20.43M represents just -2.01x of debt issuance (10.14M), suggesting concerning reliance on leverage rather than internal cash generation for growth.

Segments Breakdown of Revenue (2024)

Geographical Breakdown of Revenue (2024)

Peer comparison

Companies in the Furnishings, Fixtures & Appliances
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 SGI Somnigroup International Inc. 18.99 Bn 125.40 7.03 6.62 Bn
2 SN SharkNinja, Inc. 18.48 Bn 32.14 3.04 0.89 Bn
3 MHK Mohawk Industries Inc 8.23 Bn 19.54 0.77 2.34 Bn
4 PATK Patrick Industries Inc 5.10 Bn 175.24 10.70 1.53 Bn
5 WHR Whirlpool Corp /De/ 4.88 Bn 15.36 0.31 7.19 Bn
6 HNI Hni Corp 2.23 Bn 44.66 1.16 0.46 Bn
7 TILE Interface Inc 2.17 Bn 30.23 2.24 0.39 Bn
8 LEG Leggett & Platt Inc 1.59 Bn 5.64 0.39 1.66 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.63 0.98
EV to Cash from Ops. EV/CFO 23.40 -9.92
EV to Debt EV to Debt 1.41 25.70
EV to EBIT EV/EBIT 115.22 17.69
EV to EBITDA EV/EBITDA 16.62 15.96
EV to Free Cash Flow [EV/FCF] EV/FCF 41.42 17.28
EV to Market Cap EV to Market Cap 5.58 1.76
EV to Revenue EV/Rev 0.59 1.40
Price to Book Value [P/B] P/B 0.24 9.34
Price to Earnings [P/E] P/E -5.39 16.89
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) -9.58 1.74
Dividend Payout Ratio % Div Payout % (Qtr) -10.20 9.37
Dividend per Basic Share Div per Share (Qtr) 0.17 0.51
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 18.85 28.74
Interest Coverage Int. cover (Qtr) -0.68 -23.23
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -42.05 -9.80
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 102.62 70.23
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 0.00
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -292.87 -367.80
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -82.15 -34.93
EBIT Growth (1y) % EBIT 1y % (Qtr) -340.17 -198.55
EBT Growth (1y) % EBT 1y % (Qtr) -110.71 -72.49
EPS Growth (1y) % EPS 1y % (Qtr) -66.00 -131.79
FCF Growth (1y) % FCF 1y % (Qtr) -41.79 0.53
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -4.06 -2.36
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.13 1.16
Cash Payout Ratio Cash Payout (Qtr) 0.14 0.13
Cash Ratio Cash Ratio (Qtr) 0.09 0.30
Current Ratio Curr Ratio (Qtr) 2.71 1.96
Debt to Equity Ratio Debt/Equity (Qtr) 1.39 0.57
Interest Cover Ratio Int Coverage (Qtr) -0.68 -23.23
Times Interest Earned Times Interest Earned (Qtr) -0.68 -23.23
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 1.30 -2.26
EBIT Margin % EBIT Margin % (Qtr) -2.12 -4.46
EBT Margin % EBT Margin % (Qtr) -5.24 -7.49
Gross Margin % Gross Margin % (Qtr) 36.90 33.73
Net Profit Margin % Net Margin % (Qtr) -5.50 -8.04