One-glance verdict
Undervalued
$5.62 our estimate vs market $0.56
Wall Street consensus: $1.33 (-76.4% lower than our fair-value estimate)
90% below our estimate, below the bear case
Fundamentals snapshot
The Hain Celestial Group, Inc.
HAIN · NMS · Consumer Defensive · Packaged Foods
Current price
$0.56
52-week range
$0.48 - $1.80
Market cap
$50.99M
Balance sheet
Distressed
0.23x Concerning
Net debt $544.17M. Interest coverage shows how many times profit covers the interest bill.
What stands out
1 Reward
3 Risks
1 rewards · 3 risks
- Reward Free cash flow was positive in 3/10 years.
- Risk Return on equity was -96.8% last year — the company lost money on shareholders' equity.
- Risk Operating margin compressed from 5.4% to -3.0% over 3 years.
- Risk Insider ownership is only 2.9% (peer median: 7.0%).
What this company does
The Hain Celestial Group, Inc.
Hain Celestial is a company that makes and sells a wide range of organic and natural products, including well-known brands like Celestial Seasonings tea and Earth's Best baby food. It earns most of its money from sales in North America and focuses on improving its profit margins (the percentage of each sale that is actual profit). Because Hain has so many different products, its success often depends on efficiently managing its supply chain (the entire process of making and delivering its products to store shelves).
How the company got here
The Hain Celestial Group started in 1993 as the Hain Food Group and grew by buying other natural and organic food companies. A major turning point was in 2000, when it bought the well-known herbal tea company Celestial Seasonings and changed its name to The Hain Celestial Group. For many years, the company grew by acquiring dozens of brands, becoming one of the largest natural food companies in the world. More recently, the company has shifted its strategy to focus on simplifying its large portfolio of brands and investing more in its most popular and profitable products.
What it actually does
Hain Celestial makes and sells natural and organic products that you can find in grocery stores and supermarkets. This includes a wide variety of items, from snacks like Terra vegetable chips and Garden Veggie Snacks to Celestial Seasonings teas. They also make Earth's Best organic baby food, plant-based foods and drinks under brands like WestSoy and Yves Veggie Cuisine, and personal care products like shampoos and lotions from brands such as Alba Botanica and JASON.
North America
This is the company's largest business segment, covering sales in the United States and Canada. It sells a wide range of products including snacks, baby food, teas, and plant-based foods to various stores, from big supermarkets to natural food retailers. This part of the business generates the majority of the company's total revenue (the total money earned from sales before subtracting costs).
International
This segment handles sales of Hain Celestial's products outside of North America, with a strong presence in the United Kingdom, Ireland, and other parts of Europe. Popular brands in this division include Ella's Kitchen baby food, Linda McCartney's vegetarian foods, and Hartley's jams. While smaller than the North American business, it's a significant part of the company's overall sales and focuses on established local brands.
What management is betting on now
The company's current strategy, called "Hain Reimagined," is focused on simplifying the business to promote steady, profitable growth. A key part of this plan is to concentrate on its most promising product areas: snacks, baby and kids' food, and beverages. Management is also working to make the company more efficient by reducing the number of products it sells and streamlining its supply chain (the entire process of making and delivering products to stores). The goal is to save money that can be reinvested into growing its core brands and improving its financial health by paying down debt.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
Revenue
$263.07M
Net income
$-61.95M
Diluted EPS
-0.68
Operating cash flow
$11.44M
Free cash flow
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Sources
Revenue
$338.36M
Net income
$-106.34M
Diluted EPS
-1.17
Operating cash flow
$38.34M
Free cash flow
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Sources
Revenue
$384.12M
Net income
$-116.01M
Diluted EPS
-1.28
Operating cash flow
$36.97M
Free cash flow
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Revenue
$367.88M
Net income
$-20.62M
Diluted EPS
-0.23
Operating cash flow
$-8.48M
Free cash flow
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Sources
Revenue
$363.35M
Net income
$-272.62M
Diluted EPS
-3.03
Operating cash flow
$-2.65M
Free cash flow
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Revenue
$390.35M
Net income
$-134.59M
Diluted EPS
-1.49
Operating cash flow
$4.64M
Free cash flow
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Sources
Revenue
$411.49M
Net income
$-103.97M
Diluted EPS
-1.15
Operating cash flow
$30.91M
Free cash flow
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Sources
Revenue
$394.60M
Net income
$-19.66M
Diluted EPS
-0.22
Operating cash flow
$-10.79M
Free cash flow
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Sources
Is it cheap or expensive?
Fair value $5.62 vs current price $0.56
Wall Street consensus is the average analyst price target: $1.33 (-76.4% lower than our fair-value estimate).
Our most-likely fair value is $5.62 a share — about 902.5% above today's price of $0.56, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Distressed
Net debt $544.2M. Interest coverage 0.2x.
Net debt
$544.17M
Interest coverage
0.23x
The Hain Celestial Group, Inc.'s profit covers its interest bill about 0.2 times over. which is weaker than most peers shown here.
Distressed
Worse cushion
Baseline
Better cushion
HAIN
BASELINE
The Hain Celestial Group, Inc.
Total debt $602.25M Interest coverage 0.23x This is the baseline the peer rows are being compared against.
Total debt $2.58B Interest coverage 1.23x +427% vs HAIN Carries about 5.3x more debt cushion than HAIN.
Total debt $22.47M Interest coverage 210.03x +90,040% vs HAIN Carries about 901.4x more debt cushion than HAIN.
Total debt $21.43M Interest coverage 252.48x +108,260% vs HAIN Carries about 1083.6x more debt cushion than HAIN.
Total debt $448.46M Interest coverage 9.40x +3,936% vs HAIN Carries about 40.4x more debt cushion than HAIN.
What you should know
The case for and against HAIN
1 Reward
3 Risks
Rewards
-
Free cash flow was positive in 3/10 years.
Risks
-
Return on equity was -96.8% last year — the company lost money on shareholders' equity.
-
Operating margin compressed from 5.4% to -3.0% over 3 years.
-
Insider ownership is only 2.9% (peer median: 7.0%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
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Forward P/E
6.48x
P/B
0.33x
P/S
0.04x
EV/EBITDA
9.04x
PEG ratio
1.22x
Profitability
How much profit each dollar creates
Gross margin
20.1%
Operating margin
-3.0%
Net margin
-22.5%
ROE
-96.8%
ROA
0.6%
Health
Liquidity and balance-sheet strength
Debt / equity
3.89x
Current ratio
0.50x
Quick ratio
0.22x
Total debt
$602.25M
Total cash
$58.08M
Growth
How the business has been compounding
Revenue TTM
$1.35B
Revenue 5Y CAGR
-8.0%
EPS TTM
-3.33
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$78.27M
Free CF TTM
$57.66M
FCF margin
4.3%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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