Saputo Inc. (TSE:SAP)
TSX:SAP
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Saputo Inc.
(TSX:SAP)
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Rating:72Outperform
Price Target:
C$48.00
▲(25.39% Upside)
Action:Reiterated
Date:06/06/26
The score is driven primarily by improving financial performance and a strong earnings update (margin expansion, robust cash generation, and better leverage), supported by positive technical momentum. The main offset is valuation, with a higher P/E and modest yield, alongside guidance highlighting ongoing commodity-driven volatility and cost/capex pressures.
Positive Factors
Cash Generation
Sustained operating and free cash flow provides durable funding for reinvestment, debt reduction and shareholder returns. Strong cash conversion (FCF covering a large portion of net income) and net debt/EBITDA at ~1.76x improve financial flexibility to navigate commodity cycles and fund strategic projects over months.
Negative Factors
Revenue Pressure from Commodity Prices
Revenue sensitivity to dairy commodity prices introduces persistent top-line variability. Lower realized selling prices and negative inventory timing can depress reported revenue and constrain pricing leverage; this cyclical exposure can persist for multiple quarters when global milk supplies remain abundant.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash Generation
Sustained operating and free cash flow provides durable funding for reinvestment, debt reduction and shareholder returns. Strong cash conversion (FCF covering a large portion of net income) and net debt/EBITDA at ~1.76x improve financial flexibility to navigate commodity cycles and fund strategic projects over months.
Read all positive factors
Saputo Inc. (SAP) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$16.55B
Dividend Yield1.89%
Average Volume (3M)853.24K
Price to Earnings (P/E)24.9
Beta (1Y)0.39
Revenue Growth-3.40%
EPS GrowthN/A
CountryCA
Employees19,600
SectorConsumer Defensive
Sector Strength42
IndustryPackaged Foods
Share Statistics
EPS (TTM)1.64
Shares Outstanding400,564,670
10 Day Avg. Volume768,057
30 Day Avg. Volume853,235
Financial Highlights & Ratios
PEG Ratio-0.05
Price to Book (P/B)2.62
Price to Sales (P/S)1.02
P/FCF Ratio15.16
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$47.88Price Target Upside25.07% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
EPS Forecast (FY)2.11
Revenue Forecast (FY)C$18.01B
Saputo Inc. Business Overview & Revenue Model
Company Description
Saputo Inc. operates as a prominent global dairy processor and distributor, with operations spanning Canada, the United States, Argentina, Australia, and the United Kingdom. The company boasts an extensive product lineup, offering a wide variety o...
How the Company Makes Money
Saputo makes money primarily by processing raw milk into branded and private-label dairy products and selling those products through retail, foodservice, and industrial channels. Its core revenue streams include: (1) Cheese and dairy product sales...
Saputo Inc. Earnings Call Summary
Earnings Call Date:Feb 05, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Aug 06, 2026
Earnings Call Sentiment Positive
The call emphasized strong operational execution, significant margin expansion, robust cash generation and meaningful sector-level improvements (Canada, U.S. ingredients, International and Europe). These positives outweigh the near-term revenue pressure from commodity price effects, continued market volatility due to abundant milk supply, and higher operating costs. Management conveyed confidence in continued investments, share repurchases and the ability to capture protein-driven demand while acknowledging ongoing short-term headwinds.Positive Updates
Adjusted EBITDA Growth and Margin Expansion
Adjusted EBITDA increased 18% ($75M) to $492M; adjusted margin expanded to 10.1% from 8.4% a year ago (+1.7 percentage points), reflecting cost discipline and operational efficiencies.
Negative Updates
Overall Revenue Decline
Consolidated revenue declined 2% to $4.9B year-over-year, primarily driven by lower commodity-related selling prices in key markets.
Read all updates
Q3-2026 Updates
Positive
Negative
Adjusted EBITDA Growth and Margin Expansion
Adjusted EBITDA increased 18% ($75M) to $492M; adjusted margin expanded to 10.1% from 8.4% a year ago (+1.7 percentage points), reflecting cost discipline and operational efficiencies.
Read all positive updates
Company Guidance
Management guided that U.S. dairy market volatility is likely to persist through the remainder of the fiscal year and into FY27, but reiterated confidence in long‑term protein demand and the company’s ability to invest and grow: Q3 adjusted EBITDA was $492M (up 18% or $75M) on $4.9B revenue (−2%), net earnings $220M, adjusted net earnings $235M (up 41%) and adjusted EPS $0.57 (up 46%); Q3 net cash from operations was $401M (YTD $1.1B), net debt/adjusted EBITDA improved to 1.76x, and the company returned $646M YTD to shareholders (including NCIB repurchase of 12.6M shares). Management signaled continued capital allocation to organic growth, ingredients and selective M&A—CapEx for FY27 is expected north of $400M—and highlighted major project metrics (≈$180M Waupun upgrade with ~35% higher WPC80 output; Franklin consolidation boosting output ~30%; Green Bay closure), plus segment results (Canada revenue +4% with Adj. EBITDA $189M, +8%; U.S. revenue $2.1B, −7%, Adj. EBITDA $185M, +16%; International revenue $994M, −3%, Adj. EBITDA $82M, +61%; Europe revenue $336M, +8%, Adj. EBITDA $36M, 11% margin) and a target posture toward high‑single to double‑digit U.S. EBITDA margins as efficiencies are fully realized.Saputo Inc. Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
71
Positive
Cash Flow
78
Positive
| Breakdown | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 17.55B | 19.06B | 17.34B | 17.84B | 15.04B |
| Gross Profit | 2.78B | 1.56B | 1.51B | 1.55B | 1.16B |
| EBITDA | 1.66B | 1.43B | 1.37B | 1.42B | 1.02B |
| Net Income | 672.00M | -176.00M | 265.00M | 622.00M | 274.00M |
Balance Sheet | |||||
| Total Assets | 13.61B | 13.91B | 14.26B | 14.43B | 13.68B |
| Cash, Cash Equivalents and Short-Term Investments | 444.00M | 257.00M | 466.00M | 263.00M | 165.00M |
| Total Debt | 3.27B | 3.59B | 3.99B | 4.04B | 4.25B |
| Total Liabilities | 6.80B | 6.94B | 7.21B | 7.29B | 7.18B |
| Stockholders Equity | 6.80B | 6.98B | 7.05B | 7.14B | 6.50B |
Cash Flow | |||||
| Free Cash Flow | 1.18B | 815.00M | 537.00M | 384.00M | 195.00M |
| Operating Cash Flow | 1.51B | 1.19B | 1.19B | 1.02B | 693.00M |
| Investing Cash Flow | -318.00M | -243.00M | -652.00M | -632.00M | -799.00M |
| Financing Cash Flow | -998.00M | -1.17B | -343.00M | -369.00M | -72.00M |
Saputo Inc. Technical Analysis
Neutral
38.28
Price Trends
40.78
Positive
41.60
Negative
39.18
Positive
Market Momentum
0.04
Positive
49.19
Neutral
41.86
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:SAP, the sentiment is Neutral. The current price of 38.28 is below the 20-day moving average (MA) of 41.66, below the 50-day MA of 40.78, and below the 200-day MA of 39.18, indicating a neutral trend. The MACD of 0.04 indicates Positive momentum. The RSI at 49.19 is Neutral, neither overbought nor oversold. The STOCH value of 41.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:SAP.
Saputo Inc. Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | C$16.55B | 24.90 | 9.98% | 1.89% | -3.40% | ― | |
67 Neutral | C$3.94B | 7.26 | 36.56% | 4.95% | -13.45% | 465.50% | |
63 Neutral | C$415.26M | 10.32 | 7.08% | 4.83% | 14.02% | -47.59% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
43 Neutral | C$4.47B | 109.37 | 2.21% | 3.34% | 17.36% | -65.87% |
* Consumer Defensive Sector Average
TSE:SAP
Saputo Inc.
41.31
15.31
58.85%
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Saputo Inc. Corporate Events
Business Operations and StrategyExecutive/Board Changes
Saputo Adds Veteran Transformation Executive Linda Mantia to Board
Positive
Mar 26, 2026
Saputo Inc. has appointed Linda Mantia as an independent director to its board, adding a seasoned executive with deep experience in operations, technology, digital transformation, and governance across major global organizations. Mantia, who has h...
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.