Trending stocks

Eye on Saputo Inc with its long history of healthy growth

12.06.2014 • About Saputo Inc ($SAP) • By InTwits

Pay attention to Saputo Inc as a growth stock. It showed noticeble revenue performance in the last years among with attractive profitability and financial model.

Growth story


Saputo Inc showed fast growth in the last financial year. Saputo Inc's revenue surged on 26.5% in FY2014. In addition to revenue Saputo Inc also keeps delivering EBITDA growth. It was 19.1% in FY2014

If we look for the longer period the company showed fast revenue growth of 15.4% from FY2011 to FY2014 annually. EBITDA surged on 7.33% from FY2011 to FY2014 annually.

Saputo Inc ($SAP) financials for the last 5 years

mln. CAD FY2010 FY2011 FY2012 FY2013 FY2014
Revenue5,8116,0036,9307,2989,233
Revenue growth, %3.3%15.4%5.3%26.5%
Gross margin, %11.9%13.1%12.0%11.8%11.1%
SG&A, %
EBITDA692788831818975
EBITDA growth, %13.9%5.4%-1.5%19.1%
EBITDA margin, %11.9%13.1%12.0%11.2%10.6%
Net Income383450381482533
Net Income margin, % 6.59%7.50%5.50%6.60%5.77%
 
CAPEX107112119178224
CAPEX/Revenue, %1.84%1.87%1.71%2.44%2.42%
Debt4425495471,7302,099
Cash55771444339
Net Debt/EBITDA0.6x0.6x0.5x2.1x2.1x
 
ROIC, %20.1%23.8%24.6%19.2%17.0%
ROE, %19.1%21.9%18.2%21.8%21.0%

Profitability and return on investment


Despite revenue growth EBITDA margin declined slightly from 11.2% in FY2013 to 10.6% in FY2014. If we look for the longer period Saputo Inc showed big decline in EBITDA margin of 2.50 pp from 13.1% in FY2011 to 10.6% in FY2014.

We call Saputo Inc an attractive growth stock as together with the growth it delivers high ROIC at 17.0%. Three years ago it was higher at 23.8%. Average ROIC for the last three years was 20.2%.

Net Income margin dropped on 0.800 pp from 6.60% to 5.80% in FY2014. If we look for the longer period the company's Net Income margin dropped on 1.70 pp from 7.50% in FY2011 to 5.80% in FY2014.

Saputo Inc operates at ROE of 21.0%. It's average ROE for the last three years was 20.4%.

Capital expenditures (CAPEX)


Saputo Inc's CAPEX/Revenue was 2.42% in FY2014. Saputo Inc showed fast CAPEX/Revenue growth of 0.555 pp from 1.87% in FY2011 to 2.42% in FY2014. For the last three years the average CAPEX/Revenue was 2.19%.

Leverage (Debt)


Saputo Inc has medium debt level at 2.1x Net Debt/EBITDA to maintain high growth. In the longer period leverage surged on 1.52x from 0.60x in FY2011 to 2.11x in FY2014.

Valuation vs. comparable companies


At the end of trading day today Saputo Inc traded at 14.5x EV/EBITDA which is 11.2% lower than 16.3x Consumer, Non-cyclical peer group avearge calculated on the basis of 289 companies. The company trades at 22.6x P/E which is 65.5% lower than 65.6x Consumer, Non-cyclical industry avearge calculated based on 34 companies.

Management team


Saputo Inc is headed by Lino A Saputo Jr as a CEO. Lino A Saputo Jr is a longstanding CEO having spent 10.1 years with the company.

Peers in Consumer, Non-cyclical


Below you can find Saputo Inc benchmarking vs. other companies in Consumer, Non-cyclical industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.

Top companies by Revenue growth, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top 5
ProMetic Life Sciences Inc ($PLI)-11.5%11.5%
Brick Brewing Co Ltd ($BRB)0.6%13.2%3.6%6.7%
Andrew Peller Ltd ($ADW.B)0.9%4.3%4.4%3.0%
North West Co Inc/The ($NWC)0.3%3.2%1.2%1.9%
Neptune Technologies & Bioressources Inc ($NTB)30.9%15.3%35.2%-24.6%
 
Median (5 companies)0.7%8.8%3.6%3.0%
Saputo Inc ($SAP)3.3%15.4%5.3%26.5%


Top companies by Gross margin, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top 5
ProMetic Life Sciences Inc ($PLI)77.1%67.7%69.5%
Andrew Peller Ltd ($ADW.B)33.6%38.9%38.7%36.2%34.6%
North West Co Inc/The ($NWC)9.0%28.5%28.6%29.4%29.5%
Brick Brewing Co Ltd ($BRB)18.0%23.2%23.4%24.4%26.1%
Neptune Technologies & Bioressources Inc ($NTB)55.6%52.6%39.6%12.9%
 
Median (5 companies)18.0%33.7%38.7%36.2%29.5%
Saputo Inc ($SAP)11.9%13.1%12.0%11.8%11.1%


Top companies by EBITDA margin, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top 5
Brick Brewing Co Ltd ($BRB)10.5%14.3%11.1%10.8%11.7%
Andrew Peller Ltd ($ADW.B)10.4%11.9%11.8%11.6%11.3%
North West Co Inc/The ($NWC)8.7%9.0%
ProMetic Life Sciences Inc ($PLI)10.5%-59.4%-65.8%
Neptune Technologies & Bioressources Inc ($NTB)-4.3%-26.0%-57.4%-191.4%
 
Median (5 companies)10.5%10.3%10.8%-23.3%9.0%
Saputo Inc ($SAP)11.9%13.1%12.0%11.2%10.6%


Top companies by CAPEX/Revenue, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top 5
Neptune Technologies & Bioressources Inc ($NTB)6.0%4.7%73.6%84.6%
ProMetic Life Sciences Inc ($PLI)2.1%33.6%34.6%
Brick Brewing Co Ltd ($BRB)8.1%11.4%5.2%11.1%7.9%
Andrew Peller Ltd ($ADW.B)1.9%3.0%2.6%4.5%3.2%
North West Co Inc/The ($NWC)3.1%2.4%3.0%2.8%2.6%
 
Median (5 companies)3.1%4.5%3.0%11.1%7.9%
Saputo Inc ($SAP)1.8%1.9%1.7%2.4%2.4%


Top companies by ROIC, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top 5
North West Co Inc/The ($NWC)19.4%18.8%19.3%20.9%20.9%
Andrew Peller Ltd ($ADW.B)8.4%10.6%10.8%10.4%10.1%
Brick Brewing Co Ltd ($BRB)5.5%6.6%4.6%3.6%3.8%
ProMetic Life Sciences Inc ($PLI)40.5%-65.8%-17.4%
Neptune Technologies & Bioressources Inc ($NTB)-20.4%-32.2%-56.3%
 
Median (5 companies)8.4%10.6%10.8%3.6%3.8%
Saputo Inc ($SAP)20.1%23.8%24.6%19.2%17.0%


Top companies by Net Debt / EBITDA

 FY2010 FY2011 FY2012 FY2013 FY2014
Top
Andrew Peller Ltd ($ADW.B)3.8x3.1x3.2x3.2x3.0x
Brick Brewing Co Ltd ($BRB)1.3x1.0x2.5x2.6x1.7x
North West Co Inc/The ($NWC)1.3x1.2x
 
Median (3 companies)2.5x1.3x2.5x2.9x1.7x
Saputo Inc ($SAP)0.6x0.6x0.5x2.1x2.1x