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High Liner Foods (TSE:HLF)
:HLF

High Liner Foods (HLF) AI Stock Analysis

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High Liner Foods

(TSX:HLF)

Rating:72Outperform
Price Target:
C$20.00
▲(12.87%Upside)
High Liner Foods demonstrates solid financial health and strategic resilience, supported by strong profitability and leverage improvements. The company’s attractive valuation and positive corporate events further bolster its position. However, technical indicators suggest caution due to potential overbought conditions, while earnings call data reflects ongoing market challenges. Overall, the stock presents a balanced risk-reward profile with a positive outlook for future growth.
Positive Factors
M&A Opportunities
High Liner’s leading position as a North American seafood processor, strong free cash flow profile, and clean balance sheet supportive of M&A opportunities present compelling upside for the shares.
Market Share Expansion
High Liner gained market share by leaning into the QSR channel, which is benefitting from consumers trading down from casual dining.
Retail Sales Growth
High Liner's broad portfolio, spanning across price points, and its focus on innovation fuelled retail sales and volume growth.
Negative Factors
Consumer Demand Challenges
In the near term, a challenging macro environment is reducing consumer demand and earnings growth.
Increased SG&A Costs
Net SG&A as a percentage of sales increased by 40 bps year-over-year to 8.4%, driven by higher labour costs and professional fees.
Revenue Decline
Revenue of $268 million represents a year-over-year decrease of 3.1%, with foodservice volumes coming under pressure due to consumers pulling back on out-of-home dining.

High Liner Foods (HLF) vs. iShares MSCI Canada ETF (EWC)

High Liner Foods Business Overview & Revenue Model

Company DescriptionHigh Liner Foods (HLF) is a leading North American processor and marketer of value-added frozen seafood. The company operates within the food industry, focusing on providing seafood solutions tailored to meet the needs of both retail and foodservice customers. High Liner Foods offers a wide range of seafood products, including fish fillets, shrimp, and other shellfish, catering to various market segments with quality and taste as their primary differentiators.
How the Company Makes MoneyHigh Liner Foods makes money through the sale of its frozen seafood products across retail and foodservice channels. The company's revenue model is anchored on its ability to innovate and provide value-added seafood products that appeal to a diverse customer base. High Liner Foods generates revenue from key streams including branded retail sales under labels such as High Liner, Icelandic Seafood, and Fisher Boy, as well as private-label offerings. Additionally, the company has a significant presence in the foodservice industry, supplying seafood solutions to restaurants, institutions, and other foodservice operators. Strategic partnerships with retailers and distributors, as well as a focus on sustainability and supply chain efficiency, further contribute to High Liner Foods' earnings.

High Liner Foods Earnings Call Summary

Earnings Call Date:May 13, 2025
(Q1-2025)
|
% Change Since: 5.73%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Neutral
High Liner Foods faced challenges in Q1 2025 primarily due to the later timing of Lent, a slowdown in foodservice, and foreign exchange impacts. However, the company demonstrated resilience through strong retail performance, innovation, and operational efficiencies. The promising start to Q2 indicates potential for recovery and growth despite the headwinds.
Q1-2025 Updates
Positive Updates
Retail Channel Success
Volumes and sales grew in the retail business during Q1 2025, supported by targeted promotional activities and new product innovations, such as the Sea Cuisine shrimp skewers. The U.S. retail market saw notable growth with brands like Fisher Boy and Sea Cuisine outperforming the category.
Innovation and Product Development
High Liner Foods increased focus on innovation, introducing new products such as Sea Cuisine shrimp skewers and Cheddar Biscuit Tilapia, which have been well-received in the market. The company is also leveraging alternative species to combat price and supply challenges.
Operational Performance and Strategic Initiatives
The company has implemented effective promotional strategies and operational improvements, maintaining a stable gross margin percentage despite various headwinds.
Strong Start to Q2 2025
Despite the challenges in Q1 due to the late timing of Lent, the company reported strong performance in April 2025, setting a positive tone for Q2.
Negative Updates
Decline in Sales and Volume
Sales decreased by $8.6 million or 3.1% to $268.4 million in Q1 2025, and sales volume decreased by 1.5% to GBP66 million. This decline was due to the later timing of Lent and a slowdown in foodservice traffic.
Impact of FX and Canadian Dollar Weakness
The conversion of a weaker Canadian dollar resulted in a $3.5 million decrease in sales and a $1 million decrease in gross profit in Q1 2025 compared to the same period in 2024.
Decreased Adjusted EBITDA
Adjusted EBITDA decreased by $2.1 million or 6.1% to $32.1 million, with a decrease in adjusted EBITDA as a percentage of sales to 12% compared to 12.4%.
Increased Net Debt
Net debt increased by $41.5 million to $274.7 million at the end of Q1 2025, reflecting higher bank loans and lower cash balance.
Company Guidance
During the High Liner Foods Q1 2025 conference call, the company provided detailed guidance on its financial performance, highlighting several key metrics despite the challenging macroeconomic environment. Sales volume decreased by 1.5% to GBP66 million, and net sales fell by 3.1% to $268.4 million, mainly due to a later Lenten period and decreased foodservice traffic, although retail and contract manufacturing experienced growth. Gross profit decreased by 3.1% to $63.5 million, with gross profit as a percentage of sales increasing slightly to 23.7%. Adjusted EBITDA fell by 6.1% to $32.1 million, and net income decreased by 7.8% to $15.3 million. The company also noted an increase in net debt to $274.7 million from $233.2 million at the end of fiscal 2024, with a net debt to adjusted EBITDA ratio of 2.7x. Despite these declines, the company expressed optimism in its resilience and strategic initiatives, projecting strong performance for the first half of 2025 and aiming to maintain a net debt to adjusted EBITDA ratio below its long-term target of 3x by the end of fiscal 2025.

High Liner Foods Financial Statement Overview

Summary
High Liner Foods is showing solid financial health with improvements in profitability and leverage. Despite a slight revenue decline, the company has managed to enhance its margins and cash flow generation, indicating resilience in operations. However, maintaining revenue growth amidst industry challenges remains a critical focus.
Income Statement
72
Positive
High Liner Foods has shown a mixed trend in revenue with slight growth over the past year, but a decline compared to two years ago. The gross profit margin for 2024 stands at approximately 22.7%, indicating a healthy profitability level. The net profit margin improved from 2.9% in 2023 to 6.3% in 2024, showcasing a strong recovery. However, the revenue decline from 2023 to 2024 indicates potential challenges in maintaining sales growth.
Balance Sheet
68
Positive
The company's debt-to-equity ratio has improved, moving from 0.66 in 2023 to 0.56 in 2024, reflecting better leverage management. Return on equity increased to 14.8% in 2024, suggesting effective use of equity capital. However, the equity ratio remains stable at around 47.8%, indicating a balanced approach between debt and equity financing.
Cash Flow
75
Positive
Free cash flow has decreased from previous years but remains positive, with a free cash flow to net income ratio of approximately 1.11 in 2024. The operating cash flow to net income ratio is robust at around 1.51, indicating strong cash generation relative to net income. Although free cash flow growth has slowed, the company maintains a healthy cash flow position.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
959.22M1.08B1.07B875.40M827.45M
Gross Profit
217.27M218.69M229.93M198.54M177.92M
EBIT
80.55M60.29M84.08M56.58M56.16M
EBITDA
115.09M85.17M106.41M86.27M78.09M
Net Income Common Stockholders
60.16M31.68M54.73M42.25M28.80M
Balance SheetCash, Cash Equivalents and Short-Term Investments
19.95M7.30M5.82M983.00K33.15M
Total Assets
849.31M834.40M1.00B826.47M776.56M
Total Debt
228.98M253.56M380.69M266.19M303.82M
Net Debt
213.52M246.26M380.53M265.74M270.89M
Total Liabilities
443.58M448.54M630.07M493.94M485.56M
Stockholders Equity
405.73M385.86M373.42M332.52M291.00M
Cash FlowFree Cash Flow
66.78M160.26M-96.83M8.37M94.05M
Operating Cash Flow
90.59M179.31M-76.16M28.68M103.00M
Investing Cash Flow
-40.24M-18.80M-20.67M-20.32M-8.95M
Financing Cash Flow
-40.66M-153.85M100.14M-41.42M-63.86M

High Liner Foods Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price17.72
Price Trends
50DMA
16.99
Positive
100DMA
16.36
Positive
200DMA
15.04
Positive
Market Momentum
MACD
0.23
Positive
RSI
46.55
Neutral
STOCH
14.22
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:HLF, the sentiment is Neutral. The current price of 17.72 is above the 20-day moving average (MA) of 17.56, above the 50-day MA of 16.99, and above the 200-day MA of 15.04, indicating a neutral trend. The MACD of 0.23 indicates Positive momentum. The RSI at 46.55 is Neutral, neither overbought nor oversold. The STOCH value of 14.22 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:HLF.

High Liner Foods Peers Comparison

Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
TSMFI
73
Outperform
C$3.45B36.326.05%3.24%3.16%
TSHLF
72
Outperform
C$516.87M6.5514.49%3.72%-4.45%90.27%
TSPBH
68
Neutral
C$3.65B30.536.75%4.18%6.29%24.34%
65
Neutral
$8.94B14.984.76%203.76%3.54%-2.49%
TSSAP
60
Neutral
C$10.99B42.30-2.28%2.86%9.20%-147.37%
* Consumer Defensive Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:HLF
High Liner Foods
17.25
4.47
34.98%
TSE:MFI
Maple Leaf Foods
27.76
5.64
25.50%
TSE:SAP
Saputo Inc.
26.51
-2.53
-8.71%
TSE:PBH
Premium Brands
80.89
-5.51
-6.38%

High Liner Foods Corporate Events

Executive/Board ChangesShareholder MeetingsBusiness Operations and Strategy
High Liner Foods Secures Shareholder Approval for Key Governance Measures
Positive
May 14, 2025

High Liner Foods announced that all proposed nominees were elected as directors during its Annual and Special General Meeting. Additionally, PricewaterhouseCoopers LLP was appointed as the auditor, and shareholders approved amendments to the company’s articles of association and an advisory resolution on executive compensation, indicating strong shareholder support for the company’s governance and strategic direction.

The most recent analyst rating on (TSE:HLF) stock is a Hold with a C$14.50 price target. To see the full list of analyst forecasts on High Liner Foods stock, see the TSE:HLF Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
High Liner Foods Reports Q1 2025 Results: Retail Gains Amid Market Challenges
Neutral
May 13, 2025

High Liner Foods reported its financial results for the first quarter of 2025, noting a decrease in sales volume and net income compared to the previous year. Despite these challenges, the company experienced improved retail performance due to value-driven promotions and growth in the Club category, which helped offset market pressures. The later timing of the Lenten period affected overall performance, but a strong finish to the quarter and a positive start to the second quarter were observed. The company remains committed to supporting foodservice operators and driving profitable growth amid an uncertain macro environment.

The most recent analyst rating on (TSE:HLF) stock is a Hold with a C$14.50 price target. To see the full list of analyst forecasts on High Liner Foods stock, see the TSE:HLF Stock Forecast page.

Business Operations and Strategy
High Liner Foods to Participate in BMO Global Conference
Neutral
May 7, 2025

High Liner Foods has announced its participation in the BMO Global Farm to Market Conference, taking place in New York City on May 14-15, 2025. The company’s President and CEO, Paul Jewer, will discuss strategies for navigating risk to achieve sustainable growth during a fireside chat. This participation highlights High Liner Foods’ commitment to engaging with industry leaders and institutional investors, potentially impacting its market positioning and stakeholder relations.

Shareholder MeetingsRegulatory Filings and Compliance
High Liner Foods Updates Management Information Circular for Shareholder Meeting
Neutral
May 1, 2025

High Liner Foods has filed an amended and restated management information circular for its upcoming annual and special general meeting of shareholders. The amendment corrects the quorum requirements for meetings of directors and shareholders, ensuring accurate representation in the company’s governance documents. This update is crucial for maintaining proper corporate governance and ensuring shareholder confidence in the company’s decision-making processes.

Financial Disclosures
High Liner Foods Schedules Q1 2025 Earnings Release and Conference Call
Neutral
Apr 30, 2025

High Liner Foods announced the release of its first quarter earnings for 2025, scheduled for May 13, with a subsequent conference call on May 14 to discuss the results. This announcement is significant for stakeholders as it provides insights into the company’s financial performance and strategic positioning in the competitive frozen seafood market.

Business Operations and StrategyRegulatory Filings and Compliance
High Liner Foods Appoints PwC as New Auditor for 2025
Neutral
Mar 14, 2025

High Liner Foods has announced the appointment of PricewaterhouseCoopers LLP (PwC) as its new external auditor for fiscal 2025, following a comprehensive request for proposal process. This change reflects the company’s commitment to best corporate governance practices and comes after Ernst & Young LLP’s long tenure as the company’s auditor. The transition has been smooth, with no reservations or reportable events noted in Ernst & Young’s recent reports.

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.