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Development of Business Hormel Foods Corporation, a Delaware corporation, was founded by George A. The Company originated as a processor of meat and food products and continues in this line of business today.
Operating margin is thin at 5.94%. Limited cushion if revenue slows or costs rise, not the profile of a wide-moat business.
Revenue growth slowed to 1.6%, essentially flat. Margins also contracted 3.0pp. This is a business that needs a catalyst.
Free cash flow declined 47% versus the prior year, cash generation momentum has weakened. ROIC dropped from 7.53% to 4.85%, capital efficiency is deteriorating.
Profitability & Returns
Revenue (TTM)
$12.22B
▲ +1.6% YoY
Net Income (TTM)
$467M
▼ -40.6% YoY
Op. Margin
5.75%
▼ -3.0pp YoY
ROIC
4.72%
▼ -2.7pp YoY
Cash Flow & Balance Sheet
FCF (TTM)
$693M
▼ -47.1% YoY
Op. Cash Flow (TTM)
$1.01B
▼ -33.3% YoY
Net Debt
$2.02B
Cash & Equiv.
$860M
5Y CAGR: +4.7%
5Y CAGR: -6.8%
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