SunOpta (STKL) AI Stock Analysis

• Market Cap: $459.59M
• Dividend Yield: N/A
• Average Volume (3M): 968.83K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.00
• Revenue Growth: -5.50%
• EPS Growth: 89.98%
• Country: US
• Employees: 1,248
• Sector: Consumer Defensive
• Sector Strength: 94
• Industry: Packaged Foods
• EPS (TTM): -0.15
• Shares Outstanding: 117,242,320
• 10 Day Avg. Volume: 1,359,330
• 30 Day Avg. Volume: 968,827
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.84
• Price to Cash Flow (P/CF): 4.60
• P/FCF Ratio: 4.40
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $10.25
• Price Target Upside: 161.48% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

SunOpta's stock score is driven by a mixed financial performance, with notable revenue and cash flow improvements overshadowed by profitability and leverage issues. Technical indicators suggest a bearish trend, and valuation metrics are weak due to negative earnings. The earnings call provides some optimism with future growth and efficiency plans, but operational challenges remain a concern.

Positive Factors

Growth Potential

SunOpta's growth potential is identified as a compelling aspect for investors.

Operational Efficiency

Efficiencies in manufacturing processes are expected to benefit margins and return on invested capital in the future.

Revenue Growth

SunOpta continues to be a supplier of choice for the on-trend plant-based space, and this momentum is expected to continue into 2025, with revenue guidance calling for growth of 7-11%.

Negative Factors

Depreciation Impact

Gross margin of 10.3% was slightly below our 15.3% estimate due to additional depreciation from newly launched production assets, along with short-term investments aimed at enhancing long-term supply chain efficiency.

Gross Margin Concerns

Q4's modest upside to revenue & EBITDA was overshadowed by lighter gross margin, including growth investments & temporary supply chain dislocation, and lighter FY25 guidance for revenue and EBITDA.

Guidance Concerns

FY25 EBITDA guidance is viewed as lighter than expected and requires further exploration.

SunOpta Business Overview & Revenue Model

Company Description

SunOpta Inc. manufactures and sells plant-based and fruit-based food and beverage products to retail customers, foodservice distributors, branded food companies, and food manufacturers worldwide. The company operates through two segments, Plant-Based Foods and Beverages, and Fruit-Based Foods and Beverages. The Plant-Based Foods and Beverages segment provides plant-based beverages, and liquid and dry ingredients that utilizes almond, soy, coconut, oat, hemp, and other bases, as well as broths, teas, and nutritional beverages. This segment also packages dry- and oil-roasted in-shell sunflower and sunflower kernels; and processes and sells raw sunflower inshell and kernel for food and feed applications. The Fruit-Based Foods and Beverages segment offers individually quick frozen (IQF) fruits, such as strawberries, blueberries, mangos, pineapples, blends, and other berries for retail; and IQF and bulk frozen fruits, including purées, toppings, and smoothies for foodservice, and custom fruit preparations for industrial use. This segment also provides fruit snacks comprising bars, twists, ropes, and bite-sized products. The company was formerly known as Stake Technology Ltd. and changed its name to SunOpta Inc. in October 2003. SunOpta Inc. was founded in 1973 and is headquartered in Eden Prairie, Minnesota.

How the Company Makes Money

SunOpta makes money through the sale of its diverse range of plant-based and fruit-based food and beverage products. The company generates revenue by supplying both retail and foodservice markets, leveraging its extensive distribution network. Key revenue streams include private label products, co-manufacturing services, and branded product offerings. SunOpta also benefits from strategic partnerships with retailers and foodservice providers, which enhance its market reach and customer base. Additionally, the company's focus on innovation and sustainable practices helps attract a loyal customer following, contributing significantly to its earnings.

SunOpta Financial Statement Overview

Summary

SunOpta's financial statements reflect a company in recovery with improving revenue and cash flow yet struggling with profitability and high leverage. The income statement shows positive growth trends, while the balance sheet indicates potential risks due to high debt levels. Cash flow improvements are notable, enhancing liquidity despite net losses.

Income Statement

SunOpta has shown a positive revenue growth of 14.85% from 2023 to 2024, indicating a strong recovery from previous declines. However, the company still faces profitability challenges, as reflected in its negative net income and net profit margin. The gross profit margin improved slightly to 13.31% in 2024, and EBIT margin increased to 2.15%, showing better operational efficiency.

Balance Sheet

The company has a high debt-to-equity ratio of 1.06 in 2024, suggesting significant leverage which could pose financial risks. The equity ratio of 22.23% indicates a moderate level of equity relative to total assets. Return on equity remains negative due to negative net income, impacting overall financial health.

Cash Flow

SunOpta improved its free cash flow from negative in 2023 to positive in 2024, reflecting better cash management. Operating cash flow to net income ratio of -3.01 in 2024 shows reliance on non-operating factors to generate cash. While free cash flow to net income ratio is 1.17, signaling better cash availability against negative net income.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Mar 2022	Mar 2021
Income Statement		Total Revenue
723.73M	630.30M	934.66M	812.62M	789.21M
	Gross Profit
96.30M	88.62M	122.85M	98.08M	109.08M
	EBIT
15.59M	8.27M	1.13M	2.37M	-12.72M
	EBITDA
15.59M	38.22M	41.31M	36.08M	11.16M
	Net Income Common Stockholders
-17.39M	-175.02M	-9.52M	-4.14M	-47.30M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.55M	306.00K	679.00K	227.00K	251.00K
	Total Assets
668.53M	669.42M	855.85M	755.12M	585.62M
	Total Debt
156.89M	379.14M	399.12M	275.83M	107.06M
	Net Debt
155.33M	378.83M	398.44M	275.61M	106.80M
	Total Liabilities
519.93M	493.89M	508.58M	421.99M	252.69M
	Stockholders Equity
148.59M	175.53M	347.27M	333.13M	332.93M
Cash Flow		Free Cash Flow
20.41M	-31.28M	-68.05M	-104.80M	66.94M
	Operating Cash Flow
52.34M	14.84M	60.58M	-21.43M	91.70M
	Investing Cash Flow
-18.68M	44.03M	-106.82M	-94.45M	324.52M
	Financing Cash Flow
-31.09M	-50.80M	46.70M	115.86M	-417.68M

SunOpta Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.92
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STKL, the sentiment is Negative. The current price of 3.92 is below the 20-day moving average (MA) of 4.72, below the 50-day MA of 5.92, and below the 200-day MA of 6.41, indicating a bearish trend. The MACD of -0.47 indicates Positive momentum. The RSI at 20.09 is Positive, neither overbought nor oversold. The STOCH value of 7.09 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for STKL.

SunOpta Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LWAY	73 Outperform	$355.60M	39.19	13.64%	―	16.67%	-20.96%
SENEA	71 Outperform	$574.70M	15.18	6.35%	―	4.01%	22.46%
NATR	70 Outperform	$222.73M	29.83	4.98%	―	2.03%	-47.76%
Sector *	63 Neutral	$20.84B	14.17	-16.36%	3.22%	1.30%	4.55%
BGS	55 Neutral	$492.24M	―	-36.94%	12.22%	-6.30%	-258.92%
STKL	54 Neutral	$459.59M	―	-6.77%	―	-5.50%	89.98%
HAIN	44 Neutral	$304.13M	―	-19.41%	―	-6.68%	-9.71%