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Pilgrim's Pride (PPC)
NASDAQ:PPC
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Pilgrim's Pride
(NASDAQ:PPC)
Rating:81Outperform
Price Target:
$55.00
▲(14.89% Upside)
Positive Factors
Dividends
PPC announced a $1.5bn special dividend, signaling financial strength and a commitment to returning value to shareholders.
Growth Strategy
PPC has plans for geographic expansion and business integration, which are expected to drive growth and enhance margins.
Negative Factors
Margin Risks
US chicken margins may lag in future due to stronger production growth in shoulder periods.
Seasonality Risks
Analyst sees near-term risk from seasonality and accelerating production indicators.
Pilgrim's Pride (PPC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$11.40B
Dividend YieldN/A
Average Volume (3M)1.24M
Price to Earnings (P/E)9.2
Beta (1Y)0.24
Revenue Growth2.06%
EPS Growth63.27%
CountryUS
Employees62,600
SectorConsumer Defensive
Sector Strength60
IndustryPackaged Foods
Share Statistics
EPS (TTM)1.70
Shares Outstanding237,547,440
10 Day Avg. Volume1,191,674
30 Day Avg. Volume1,242,478
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.15
Enterprise Value/Revenue0.72
Enterprise Value/Gross Profit5.24
Enterprise Value/Ebitda6.24
Forecast
1Y Price Target
$49.80Price Target Upside4.03% Upside
Rating ConsensusHold
Number of Analyst Covering5
Pilgrim's Pride Business Overview & Revenue Model
Company DescriptionPilgrim's Pride Corporation (PPC) is one of the largest poultry producers in the United States, primarily engaged in the production, processing, and distribution of chicken products. The company operates in the meat processing sector, providing a wide range of products including fresh and frozen chicken, prepared foods, and value-added products. Pilgrim's Pride serves various markets, including retail, foodservice, and export customers, and is known for its commitment to quality and sustainability in poultry production.
How the Company Makes MoneyPilgrim's Pride generates revenue primarily through the sale of poultry products, including whole chickens, chicken parts, and processed chicken items. The company benefits from economies of scale due to its large production capacity and extensive distribution network. Key revenue streams include sales to grocery stores, restaurants, and food wholesalers. Additionally, Pilgrim's Pride engages in export activities, selling products to international markets. The company also invests in value-added products, which command higher prices and margins. Strategic partnerships with retailers and foodservice providers further enhance its market presence and contribute to consistent revenue growth. Factors such as fluctuating feed costs, consumer demand trends, and regulatory changes also play significant roles in its overall earnings.
Pilgrim's Pride Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: 0.36%|
Next Earnings Date:Oct 22, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong revenue and EBITDA growth, particularly in the U.S. and Prepared Foods segments, alongside significant investments in growth and a special dividend announcement. However, challenges such as declining margins in Mexico, legal expenses, and production constraints were noted.Q2-2025 Updates
Positive Updates
Revenue and EBITDA Growth
Net revenues for Q2 2025 were $4.8 billion, a 4.3% increase from the same quarter last year. Adjusted EBITDA was $687 million, up 4.7% compared to Q2 2024.
Special Dividend Announcement
Pilgrim's Pride announced a special dividend of approximately $500 million, demonstrating strong cash flow generation and shareholder value creation.
Strong U.S. Performance
U.S. operations reported a 6% increase in net revenues to $2.82 billion, with adjusted EBITDA margins rising to 17.1% from 16.7% last year.
Prepared Foods Growth
Prepared Foods net sales increased by 20% compared to last year, with significant growth in the Just Bare and Pilgrim's brands.
European Margin Expansion
Europe's adjusted EBITDA margins increased to 8.2% from 7.4% last year, driven by structural reorganization and key customer partnerships.
Investment in Growth
Announced a $400 million investment in a new Prepared Foods plant in Georgia to capitalize on long-term growth trends and expand capacity.
Strong Financial Position
Net debt totaled less than $2.3 billion with a leverage ratio of less than 1x adjusted EBITDA, allowing for robust liquidity and financial flexibility.
Negative Updates
Mexico EBITDA Margin Decline
Mexico's adjusted EBITDA margin decreased to 16.3% from 19.4% a year ago, attributed to FX headwinds and bird disease challenges.
Legal Settlement Expenses
Incurred legal settlement expenses of $58 million in the quarter due to settlements associated with ongoing boilers litigation.
Challenges in Hatchability and Production
Continued challenges with hatchability and production constraints, impacting the ability to fully capitalize on strong chicken demand.
Company Guidance
During the second quarter of 2025, Pilgrim's Pride reported net revenues of $4.8 billion, marking a 4.3% increase from the same period last year, with an adjusted EBITDA of $687 million, up 4.7% year-over-year, and maintaining an EBITDA margin of 14.4%. The U.S. segment showed a 6% rise in net revenues to $2.82 billion, with adjusted EBITDA reaching $482.7 million, supported by strong commodity chicken markets, moderate grain input costs, and operational improvements. In Europe, adjusted EBITDA margins improved to 8.2% due to cost efficiencies and product mix optimization, while Mexico experienced robust performance with adjusted EBITDA at $92.3 million, despite a 13% FX headwind. To capitalize on growth opportunities, Pilgrim's announced a $400 million investment in a new Prepared Foods plant in Georgia, aiming to increase U.S. Prepared Foods sales by over 40% upon completion. Additionally, a special dividend of approximately $500 million was declared, reflecting strong cash flow generation and a leverage ratio of less than 1x adjusted EBITDA.Pilgrim's Pride Financial Statement Overview
Summary
Pilgrim's Pride demonstrates strong financial health with growing revenues, solid profitability, and efficient cash flow management. The low leverage and high ROE are positive indicators of stability and growth potential. However, there is room for improvement in equity utilization to further strengthen financial resilience.Income Statement
Pilgrim's Pride shows robust revenue growth with a TTM revenue increase of 1.67% over the previous year. The Gross Profit Margin of 13.79% and Net Profit Margin of 6.80% are strong, demonstrating efficient operations and profitability. The EBIT Margin of 9.53% and EBITDA Margin of 10.92% further indicate effective cost control and operational efficiency.85
Very Positive
Balance Sheet
The company's Debt-to-Equity Ratio has improved, now at 0.05, indicating low leverage compared to previous periods, which enhances financial stability. The Return on Equity of 33.11% is strong, reflecting efficient utilization of equity. However, the Equity Ratio of 36.94% suggests a moderate reliance on equity financing, which could be strengthened.78
Positive
Cash Flow
Pilgrim's Pride exhibits a solid Free Cash Flow Growth Rate of -16.69%, indicating stable cash generation despite a decrease. The Operating Cash Flow to Net Income Ratio is 1.31, highlighting good cash conversion from profits. The Free Cash Flow to Net Income Ratio of 1.02 demonstrates efficient cash utilization.82
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 18.18B | 17.88B | 17.36B | 17.47B | 14.78B | 12.09B |
| Gross Profit | 2.51B | 2.31B | 1.12B | 1.81B | 1.37B | 838.20M |
| EBITDA | 2.11B | 2.01B | 987.39M | 1.58B | 619.01M | 625.05M |
| Net Income | 1.24B | 1.09B | 321.57M | 745.93M | 31.00M | 94.76M |
Balance Sheet | ||||||
| Total Assets | 10.12B | 10.65B | 9.81B | 9.26B | 8.91B | 7.47B |
| Cash, Cash Equivalents and Short-Term Investments | 849.04M | 2.05B | 697.75M | 400.99M | 427.66M | 547.62M |
| Total Debt | 3.37B | 3.47B | 3.61B | 3.53B | 3.57B | 2.57B |
| Total Liabilities | 6.37B | 6.40B | 6.47B | 6.40B | 6.32B | 4.90B |
| Stockholders Equity | 3.74B | 4.24B | 3.33B | 2.84B | 2.58B | 2.56B |
Cash Flow | ||||||
| Free Cash Flow | 1.26B | 1.51B | 134.06M | 182.75M | -55.21M | 369.49M |
| Operating Cash Flow | 1.62B | 1.99B | 677.88M | 669.86M | 326.46M | 724.25M |
| Investing Cash Flow | -508.47M | -460.80M | -503.35M | -445.25M | -1.32B | -327.00M |
| Financing Cash Flow | -1.59B | -150.91M | 116.73M | -232.01M | 901.31M | -136.71M |
Pilgrim's Pride Technical Analysis
Neutral
47.87
Price Trends
46.62
Positive
48.19
Negative
46.21
Positive
Market Momentum
0.60
Positive
49.53
Neutral
16.36
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PPC, the sentiment is Neutral. The current price of 47.87 is below the 20-day moving average (MA) of 48.42, above the 50-day MA of 46.62, and above the 200-day MA of 46.21, indicating a neutral trend. The MACD of 0.60 indicates Positive momentum. The RSI at 49.53 is Neutral, neither overbought nor oversold. The STOCH value of 16.36 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PPC.
Pilgrim's Pride Risk Analysis
Pilgrim's Pride disclosed 26 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 | $11.40B | 9.23 | 33.13% | ― | 2.06% | 63.27% | |
76 Outperform | $6.12B | 9.58 | 21.17% | 2.37% | -1.19% | 78.79% | |
72 Outperform | $9.15B | 7.98 | 13.27% | 7.38% | -3.64% | 231.77% | |
66 Neutral | $15.66B | 20.95 | 9.39% | 4.08% | -1.01% | -2.93% | |
63 Neutral | $20.73B | 14.39 | -8.06% | 3.14% | 2.73% | -10.04% | |
60 Neutral | $11.82B | 22.22 | -17.87% | 3.89% | 6.69% | -261.87% | |
58 Neutral | $4.83B | 21.93 | -190.65% | ― | 16.27% | 5.13% |
* Consumer Defensive Sector Average
Performance Comparison
PPC
Pilgrim's Pride
47.87
9.11
23.50%
BRFS
BRF SA
3.66
-0.91
-19.91%
CAG
Conagra Brands
18.98
-10.35
-35.29%
HRL
Hormel Foods
28.28
-3.18
-10.11%
SJM
JM Smucker
111.47
-4.76
-4.10%
BRBR
BellRing Brands
38.49
-16.80
-30.39%
Pilgrim's Pride Corporate Events
DividendsBusiness Operations and StrategyFinancial Disclosures
Pilgrim’s Pride Announces Special Dividend Amid Strong Q2 Results
Positive
Jul 31, 2025
On July 30, 2025, Pilgrim’s Pride announced a special dividend of $2.10 per share, totaling approximately $500 million, to be paid to shareholders on August 20, 2025. The company reported strong second-quarter 2025 results, with net sales of $4.8 billion and an operating income of $512.3 million. The U.S. business saw growth in sales and profitability, driven by demand for fresh and prepared foods, while European and Mexican operations also showed positive performance. The company plans to build a new prepared foods plant in Georgia to support growth in higher-margin branded products, creating over 630 jobs and boosting U.S. Prepared Foods sales by over 40%.
Business Operations and StrategyFinancial Disclosures
Pilgrim’s Pride Reports Q2 2025 Financial Results
Positive
Jul 31, 2025
Pilgrim’s Pride Corporation reported its financial results for the second quarter ended June 29, 2025, showing a year-over-year increase in net revenue and operating income, driven by higher commodity market pricing and growth with key customers. The U.S. segment benefited from increased sales, while Europe saw profit improvements due to cost reduction strategies. However, Mexico’s profitability declined due to foreign currency impacts. The company also noted changes in inventory levels and pricing trends in the industry, with total chicken inventories up 1.8% year-over-year but below the five-year average.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.