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Pilgrim's Pride (PPC)
NASDAQ:PPC
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Pilgrim's Pride
(NASDAQ:PPC)81Outperform
Positive Factors
Earnings
Stronger US chicken margins and improvements in EU/UK drove PPC's 3Q24 earnings beat.
Market Demand
PPC noted strength of US chicken demand, particularly at retail, and EU wage growth outpacing inflation as key 3Q drivers.
Negative Factors
Seasonality
Analyst sees near-term risk from seasonality and accelerating production indicators.
Pilgrim's Pride (PPC) vs. S&P 500 (SPY)
Market Cap
$12.78B
Dividend YieldN/A
Average Volume (3M)1.25M
Price to Earnings (P/E)11.8
Beta (1Y)0.28
Revenue Growth2.93%
EPS Growth237.51%
CountryUS
Employees61,600
SectorConsumer Defensive
Sector Strength73
IndustryConsumer Products - Foods
Share Statistics
EPS (TTM)4.57
Shares Outstanding237,122,210
10 Day Avg. Volume1,189,596
30 Day Avg. Volume1,250,559
Financial Highlights & Ratios
PEG Ratio0.05
Price to Book (P/B)N/A
Price to Sales (P/S)0.73
Price to Cash Flow (P/CF)9.30
P/FCF Ratio8.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$48.00Price Target Upside-10.08% Downside
Rating ConsensusHold
Number of Analyst Covering3
Pilgrim's Pride Business Overview & Revenue Model
Company DescriptionPilgrim's Pride Corp. is engaged in the production, processing, marketing and distribution of fresh, frozen, and value-added chicken products to retailers, distributors and foodservice operators. It operates through the following segments: U.S., U.K. & Europe and Mexico. The company was founded by Lonnie A. Pilgrim and Aubrey Pilgrim on October 2, 1946 and is headquartered in Greeley, CO.
How the Company Makes MoneyPilgrim's Pride makes money primarily through the production and sale of chicken products, which are distributed across several key channels. The company's revenue model is centered around its extensive operations in the retail and foodservice sectors, where it supplies fresh and prepared chicken to grocery stores, restaurants, and other foodservice providers. Additionally, Pilgrim's Pride benefits from international sales, exporting products to numerous countries, which diversifies its revenue streams. Significant partnerships with major retailers and foodservice chains enhance its market reach and contribute to its earnings. The company's strategic focus on efficiency, product quality, and customer satisfaction further bolsters its profitability.
Pilgrim's Pride Financial Statement Overview
Summary
Pilgrim's Pride shows strong financial performance with robust revenue growth, high profitability margins, a solid equity base, and effective cash flow management. The company has improved leverage, enhancing its financial stability.Income Statement
Pilgrim's Pride has demonstrated robust revenue growth and impressive profitability over recent years. The gross profit margin for the latest period is approximately 12.94%, and the net profit margin stands at 6.08%, both showing improvement. The revenue growth rate from the previous year is 2.97%, indicating steady growth. The EBIT and EBITDA margins are strong at 8.42%, reflecting efficient operations and cost management. Overall, the income statement reflects a positive trajectory in revenues and profitability.88
Very Positive
Balance Sheet
The balance sheet shows a healthy equity ratio of 39.81%, indicating a strong equity position relative to total assets. The debt-to-equity ratio has significantly improved to 0.05, suggesting low leverage, which reduces financial risk. Return on Equity (ROE) is 25.63%, a positive indicator of profitability relative to shareholder investment. Overall, the balance sheet indicates solid financial stability, although continuous monitoring of liabilities is advised.75
Positive
Cash Flow
The cash flow statements reveal a strong operating cash flow to net income ratio of 1.83, indicating effective cash generation from operations. The free cash flow growth rate has seen substantial improvement, and the free cash flow to net income ratio is 1.83, showcasing efficient capital expenditure management. The cash flow position is robust, supporting both operational and strategic initiatives.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 17.88B | 17.36B | 17.47B | 14.78B | 12.09B | Gross Profit |
| 2.31B | 1.12B | 1.81B | 1.37B | 838.20M | EBIT |
| 1.51B | 522.29M | 1.18B | 211.16M | 245.46M | EBITDA |
| 2.01B | 987.39M | 1.64B | 597.79M | 582.69M | Net Income Common Stockholders |
| 1.09B | 321.57M | 745.93M | 31.00M | 94.76M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 2.05B | 731.22M | 400.99M | 427.66M | 547.62M | Total Assets |
| 10.65B | 9.81B | 9.26B | 8.91B | 7.47B | Total Debt |
| 196.80M | 3.61B | 3.42B | 3.49B | 2.57B | Net Debt |
| -1.85B | 2.92B | 3.02B | 3.06B | 2.02B | Total Liabilities |
| 6.40B | 6.47B | 6.40B | 6.32B | 4.90B | Stockholders Equity |
| 4.24B | 3.33B | 2.84B | 2.58B | 2.56B |
| Cash Flow | Free Cash Flow | |||
| 1.99B | 134.06M | 182.75M | -55.21M | 369.49M | Operating Cash Flow |
| 1.99B | 677.88M | 669.86M | 326.46M | 724.25M | Investing Cash Flow |
| -460.80M | -503.35M | -445.25M | -1.32B | -327.00M | Financing Cash Flow |
| -150.91M | 116.73M | -232.01M | 901.31M | -136.71M |
Pilgrim's Pride Technical Analysis
Positive
53.38
Price Trends
48.71
Positive
49.08
Positive
44.86
Positive
Market Momentum
1.58
Positive
58.03
Neutral
53.84
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PPC, the sentiment is Positive. The current price of 53.38 is above the 20-day moving average (MA) of 52.52, above the 50-day MA of 48.71, and above the 200-day MA of 44.86, indicating a bullish trend. The MACD of 1.58 indicates Positive momentum. The RSI at 58.03 is Neutral, neither overbought nor oversold. The STOCH value of 53.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PPC.
Pilgrim's Pride Risk Analysis
Pilgrim's Pride disclosed 25 risk factors in its most recent earnings report. Pilgrim's Pride reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Pilgrim's Pride Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $12.78B | 11.80 | 25.63% | ― | 2.93% | 237.51% | |
75 Outperform | $21.13B | 20.01 | 5.74% | 3.27% | 1.27% | ― | |
75 Outperform | $11.97B | 8.32 | 16.17% | 9.94% | 7.77% | 492.62% | |
71 Outperform | $5.21B | 8.57 | 21.60% | 2.83% | 5.96% | ― | |
71 Outperform | $4.34B | 6.89 | 34.26% | 4.83% | 15.57% | 38.87% | |
64 Neutral | $15.87B | 20.98 | 9.54% | 3.94% | -1.84% | -5.14% | |
63 Neutral | $20.85B | 13.27 | -10.88% | 7.48% | 1.13% | 11.50% |
* Consumer Defensive Sector Average
Performance Comparison
PPC
Pilgrim's Pride
53.38
21.41
66.97%
BRFS
BRF SA
3.24
0.06
1.89%
CALM
Cal-Maine Foods
84.19
29.98
55.30%
HRL
Hormel Foods
28.76
-4.22
-12.80%
TSN
Tyson Foods
60.74
9.04
17.49%
JBSAY
JBS SA
11.09
3.03
37.59%
Pilgrim's Pride Earnings Call Summary
Earnings Call Date: Feb 12, 2025 | % Change Since: 6.06% | Next Earnings Date: Apr 23, 2025
Earnings Call Sentiment Positive
The earnings call reflects a generally strong performance for Pilgrim's Pride, with notable improvements in net revenues and EBITDA margins, driven by strategic diversification and operational efficiency. However, challenges remain with hatchability issues and weather-related disruptions. The positive aspects seem to outweigh the negative, indicating a successful year overall.Highlights
Strong Q4 Financial Performance
Net revenues for Q4 2024 were $4.4 billion with an adjusted EBITDA of $526 million and an adjusted EBITDA margin of 12%, reflecting successful strategy execution and operational excellence.
Full Year 2024 Achievements
For the fiscal year 2024, net revenues reached $17.9 billion with an adjusted EBITDA of $2.2 billion, translating to an adjusted EBITDA margin of 12.4%.
U.S. Operations Improvement
U.S. Fresh portfolio showed improvement compared to last year, with Case Ready and Small Bird segments driving profitable growth.
Europe and Mexico Margin Expansion
Both Europe and Mexico saw margin expansion due to operational improvements, favorable market conditions, and increased consumer demand.
Positive Demand for Chicken Products
Increased demand for chicken in both retail and foodservice sectors, driven by affordability and menu penetration, supported price stability.
Lowlights
Challenges with Hatchability
Continued issues with hatchability due to a new breed, impacting production efficiency and requiring changes in management and housing structures.
Litigation and Pension Settlement Charges
Recorded $95 million in litigation-related settlement charges and $10.9 million in pension settlement charges in Q4.
Weather-Related Disruptions
Weather disruptions, including storms and cold weather, affected production levels, particularly in the Big Bird category.
Company Guidance
During the fourth quarter of fiscal year 2024, Pilgrim's Pride reported net revenues of $4.4 billion, with an adjusted EBITDA of $526 million, equating to an adjusted EBITDA margin of 12%. For the full fiscal year, net revenues reached $17.9 billion, with an adjusted EBITDA of $2.2 billion and a margin of 12.4%. The U.S. market saw significant improvements, particularly in the Big Bird segment, which expanded margins through favorable commodity cutout values and operational excellence. The Case Ready and Small Bird segments also contributed to profitable growth. In Europe, margins expanded due to optimization efforts, while in Mexico, increased commodity pricing bolstered Q4 performance. Looking ahead, the USDA projects U.S. chicken production to grow by 1.4% in 2025, with a supportive demand environment due to reduced beef availability. Despite challenges such as hatchability issues, Pilgrim's Pride continues to focus on strategic growth, operational excellence, and sustainability initiatives.Pilgrim's Pride Corporate Events
Business Operations and StrategyFinancial Disclosures
Pilgrim’s Pride Reports Strong Q4 2024 Financial Results
Positive
Feb 13, 2025
On February 13, 2025, Pilgrim’s Pride Corporation reported its financial results for the fourth quarter ended December 29, 2024, showing significant improvements across its operations. The company experienced increased net revenue and operating income driven by higher U.S. commodity market pricing, cost efficiencies, and growth with key customers, despite higher SG&A expenses due to legal settlements and compensation costs. Broiler placements and egg sets increased year-over-year, while industry cold storage supplies continued to lag behind previous years, indicating supply chain adjustments. The results suggest a strong positioning for Pilgrim’s Pride in its industry, with implications for continued operational efficiency and market growth.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.