Natures Sunshine Products Inc (NASDAQ: NATR)

Sector: Consumer Defensive Industry: Packaged Foods CIK: 0000275053
Market Cap 479.20 Mn
P/B 2.87
P/E 31.75
P/S 1.01
ROIC (Qtr) 7.86
Div Yield % 0.00
Rev 1y % (Qtr) 11.97
Total Debt (Qtr) 14.29 Mn
Debt/Equity (Qtr) 0.09
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About

Natures Sunshine Products Inc. (NATR) operates in the natural health and wellness industry, specifically focusing on the manufacturing and direct selling of nutritional and personal care products. The company, headquartered in Lehi, Utah, has a global presence with business segments in Asia, Europe, North America, and Latin America and Other, each based on the geographic region of operation. NATR's primary business activities involve the production of over 800 products that fall into different product lines such as general health, immune, cardiovascular,...

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Investment thesis

Bull case

  • Strong operating cash flow of 37.61M provides robust 2.63x coverage of total debt 14.29M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 95.55M provide 20.77x coverage of short-term debt 4.60M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 37.61M provides exceptional 332.81x coverage of minority interest expenses 113000, showing strong core operations.
  • Strong tangible asset base of 264.81M provides 18.53x coverage of total debt 14.29M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 37.61M provides exceptional 173.30x coverage of interest expenses 217000, showing strong debt service capability.

Bear case

  • Operating cash flow of 37.61M barely covers its investment activities of (6.34M), with a coverage ratio of -5.93, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating earnings of 25.88M show weak coverage of depreciation charges of 19.39M, with a 1.33 ratio indicating high capital intensity and potential reinvestment needs.
  • High depreciation of 19.39M relative to operating cash flow of 37.61M, which is 0.52x suggests significant maintenance capital requirements affecting free cash flow.
  • Operating cash flow of 37.61M barely covers operating expenses of 144.17M with a 0.26 ratio, suggesting thin operational efficiency margins and limited flexibility.
  • Retained earnings of 72.82M provide limited buffer against comprehensive income items of (15.87M), which is -4.59x, indicating elevated exposure to market risks.

Consolidation Items Breakdown of Revenue (2024)

Geographical 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 1.56 1.47
EV to Cash from Ops. EV/CFO 10.99 29.75
EV to Debt EV to Debt 28.94 27.85
EV to EBIT EV/EBIT 15.98 86.88
EV to EBITDA EV/EBITDA 9.28 -156.20
EV to Free Cash Flow [EV/FCF] EV/FCF 13.22 -5.67
EV to Market Cap EV to Market Cap 0.86 1.15
EV to Revenue EV/Rev 0.87 7.32
Price to Book Value [P/B] P/B 2.87 8.48
Price to Earnings [P/E] P/E 31.75 14.45
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 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) 119.25 6.64
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 36.77 -118.07
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 21.41 43.48
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 0.66
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -11.15 -48.16
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 12.52 -152.35
EBIT Growth (1y) % EBIT 1y % (Qtr) 8.46 -50.79
EBT Growth (1y) % EBT 1y % (Qtr) 8.51 -54.94
EPS Growth (1y) % EPS 1y % (Qtr) -5.62 -28.10
FCF Growth (1y) % FCF 1y % (Qtr) 146.45 7.02
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 7.88 439.70
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.79 1.01
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.12
Cash Ratio Cash Ratio (Qtr) 1.14 0.86
Current Ratio Curr Ratio (Qtr) 2.23 2.60
Debt to Equity Ratio Debt/Equity (Qtr) 0.09 2.21
Interest Cover Ratio Int Coverage (Qtr) 119.25 6.64
Times Interest Earned Times Interest Earned (Qtr) 119.25 6.64
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 9.50 -919.13
EBIT Margin % EBIT Margin % (Qtr) 5.45 -1,474.87
EBT Margin % EBT Margin % (Qtr) 5.41 -1,537.76
Gross Margin % Gross Margin % (Qtr) 72.30 26.98
Net Profit Margin % Net Margin % (Qtr) 3.20 -1,538.60