Hydrofarm Holdings Group (HYFM) AI Stock Analysis

• Market Cap: $14.90M
• Dividend Yield: N/A
• Average Volume (3M): 24.60K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.75
• Revenue Growth: -19.18%
• EPS Growth: -12.03%
• Country: US
• Employees: 286
• Sector: Industrials
• Sector Strength: 87
• Industry: Agricultural - Machinery
• EPS (TTM): -0.52
• Shares Outstanding: 4,642,957
• 10 Day Avg. Volume: 14,584
• 30 Day Avg. Volume: 24,598
• PEG Ratio: <0.01
• Price to Book (P/B): 1.99
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 50.66
• Enterprise Value/Market Cap: 57.83
• Enterprise Value/Revenue: 1.11
• Enterprise Value/Gross Profit: 37.57
• Enterprise Value/Ebitda: -9.53
• 1Y Price Target: $0.65
• Price Target Upside: -79.75% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 41 Neutral
• Price Target: $3.50 ▲(9.03%Upside)

Hydrofarm Holdings Group faces significant financial challenges, with declining revenues and negative cash flow trends being the most impactful factors. Technical analysis indicates a bearish trend, and valuation metrics are weak due to negative earnings and lack of dividends. Although there are efforts to improve profitability, uncertainties and industry challenges weigh heavily on the overall assessment.

Hydrofarm Holdings Group Business Overview & Revenue Model

Company Description

Hydrofarm Holdings Group, Inc., together with its subsidiaries, engages in the manufacture and distribution of controlled environment agriculture (CEA) equipment and supplies in the United States and Canada. The company offers agricultural lighting devices, indoor climate control equipment, hydroponics and nutrients, and plant additives used to grow, farm, and cultivate cannabis, flowers, fruits, plants, vegetables, grains, and herbs in controlled environment; and distributes CEA equipment and supplies, which include grow light systems; heating, ventilation, and air conditioning systems; humidity and carbon dioxide monitors and controllers; water pumps, heaters, chillers, and filters; nutrient and fertilizer delivery systems; and various growing media made from soil, rock wool or coconut fiber. It also provides hydroponics systems, such as hydro systems, hydro trays and components, meters and solutions, pumps and irrigation systems, water filtration systems, pots and containers, and tents and tarps; atmospheric control equipment comprising controllers, monitors and timers, ventilation/air conditioning equipment, air purification equipment, and CO2 equipment; and nutrients and additives. The company offers its products under the Phantom, PhotoBio, Active Aqua, Active Air, HEAVY 16, House & Garden, Mad Farmer, Roots Organics, Soul, Procision, Grotek, Gaia Green, Innovative Growers Equipment, Quantum, Xtrasun, Digilux, Agrobrite, SunBlaster, Jump Start, Active Eye, Autopilot, Phat, oxyClone, and GROW!T brands. Hydrofarm Holdings Group, Inc. was founded in 1977 and is based in Shoemakersville, Pennsylvania.

How the Company Makes Money

Hydrofarm Holdings Group generates revenue through the sale of hydroponics equipment and supplies. The company's primary revenue streams include the distribution of proprietary and third-party branded products to a wide network of retailers, commercial growers, and other end-users. Hydrofarm collaborates with a variety of vendors and manufacturers to offer a diverse product portfolio, ensuring a steady supply chain and product availability. Additionally, the company benefits from strategic partnerships and acquisitions that expand its product offerings and market reach. Factors such as increasing interest in sustainable agriculture and the growing legal cannabis market have significantly contributed to Hydrofarm's earnings by driving demand for its products.

Hydrofarm Holdings Group Financial Statement Overview

Summary

Hydrofarm Holdings Group is experiencing significant financial challenges. Declining revenues, negative profit margins, and poor cash flow performance indicate operational and financial inefficiencies. While the balance sheet shows manageable leverage, the negative return on equity and declining equity ratios highlight difficulties in generating shareholder value.

Income Statement

Hydrofarm Holdings Group has experienced declining revenues over recent periods, with the TTM showing a further decrease to $176.65 million from $190.29 million the previous year. The gross profit margin in the TTM is 12.99%, which is relatively low for the industry. The company is also facing significant losses, with a net profit margin of -38.76% and a negative EBIT margin of -23.79%, reflecting operational inefficiencies and high costs.

Balance Sheet

The company's balance sheet indicates a modest debt-to-equity ratio of 0.80, which suggests manageable leverage. However, the equity ratio has decreased to 51.14% in the TTM, indicating a potential weakening in asset financing through equity. The return on equity is negative at -32.62%, highlighting challenges in generating returns for shareholders.

Cash Flow

Cash flow performance is concerning, with negative operating cash flow in the TTM and a significant decrease in free cash flow growth. The operating cash flow to net income ratio is unfavorable, indicating insufficient cash generation from operations to cover net losses.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
176.65M	190.29M	226.58M	344.50M	479.42M	342.20M
	Gross Profit
22.94M	32.13M	37.61M	29.34M	101.49M	63.63M
	EBIT
-42.02M	-52.18M	-38.43M	-89.27M	-2.40M	-1.57M
	EBITDA
-30.31M	-19.92M	-17.51M	-229.62M	17.01M	13.69M
	Net Income Common Stockholders
-68.49M	-66.72M	-64.81M	-285.42M	13.42M	-7.27M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
13.73M	26.11M	30.31M	21.29M	26.61M	75.18M
	Total Assets
410.56M	426.10M	507.64M	573.56M	891.24M	275.80M
	Total Debt
167.44M	169.53M	183.93M	186.07M	167.57M	20.06M
	Net Debt
153.71M	143.41M	153.62M	164.78M	140.97M	-55.12M
	Total Liabilities
200.61M	202.38M	217.03M	223.68M	256.06M	64.88M
	Stockholders Equity
209.94M	223.72M	290.61M	349.88M	635.18M	210.92M
Cash Flow		Free Cash Flow
-8.62M	-3.22M	2.83M	13.76M	-50.47M	-46.33M
	Operating Cash Flow
-9.79M	-324.00K	7.04M	21.99M	-45.07M	-44.83M
	Investing Cash Flow
2.83M	1.67M	-4.17M	-8.49M	-468.18M	546.00K
	Financing Cash Flow
-2.83M	-4.78M	6.07M	-20.20M	464.71M	88.14M

Hydrofarm Holdings Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.21
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HYFM, the sentiment is Negative. The current price of 3.21 is below the 20-day moving average (MA) of 3.54, above the 50-day MA of 3.07, and below the 200-day MA of 5.14, indicating a neutral trend. The MACD of 0.08 indicates Positive momentum. The RSI at 43.43 is Neutral, neither overbought nor oversold. The STOCH value of 20.13 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HYFM.

Hydrofarm Holdings Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	66 Neutral	$4.47B	12.22	5.40%	3.65%	4.14%	-12.00%
ARTW	62 Neutral	$9.67M	292.31	2.35%	―	-19.47%	―
HYFM	41 Neutral	$14.90M	―	-28.07%	―	-19.18%	-12.03%
UGRO	38 Underperform	$3.95M	―	-146.60%	―	12.08%	25.82%
CEAD	37 Underperform	$6.66M	―	-33.60%	―	-59.43%	2.40%

Hydrofarm Holdings Group Corporate Events

Hydrofarm Holdings Appoints New Board Member, Amends Charter

On June 9, 2025, Hydrofarm Holdings Group, Inc. appointed B. John Lindeman to its board of directors, filling the vacancy left by Richard D. Moss. Concurrently, the company made amendments to its charter, retiring and eliminating references to 7,725,045 shares of Series A Preferred Stock, which were converted into common stock, and reducing the authorized shares of Series A Preferred Stock.

The most recent analyst rating on (HYFM) stock is a Hold with a $0.75 price target. To see the full list of analyst forecasts on Hydrofarm Holdings Group stock, see the HYFM Stock Forecast page.

Hydrofarm Reports Q1 2025 Financial Results Amid Challenges

On May 13, 2025, Hydrofarm Holdings Group announced its first-quarter financial results, highlighting a decrease in net sales to $40.5 million from $54.2 million in the previous year, primarily due to an oversupply in the cannabis industry. Despite the decline in sales and gross profit margins, the company achieved significant cost savings through restructuring and strategic focus on higher-margin proprietary brands, which increased to 55% of sales. The company also reported a net loss of $14.4 million, up from $12.6 million, and withdrew its full-year 2025 outlook due to macroeconomic uncertainties and industry challenges. Hydrofarm remains committed to improving profit margins and strengthening its financial position through continued cost-saving measures and strategic initiatives.

The most recent analyst rating on (HYFM) stock is a Hold with a $0.75 price target. To see the full list of analyst forecasts on Hydrofarm Holdings Group stock, see the HYFM Stock Forecast page.

Hydrofarm Revises CEO Severance Compensation Terms

On April 15, 2025, Hydrofarm Holdings Group amended its Offer Letter with CEO B. John Lindeman, revising his severance compensation terms. The amendment outlines cash severance payments and accelerated equity vesting in the event of termination, particularly following a change of control, impacting the company’s executive compensation strategy.