One-glance verdict
Undervalued
$6.42 our estimate vs market $2.88
Wall Street consensus: $5.83 (-9.1% lower than our fair-value estimate)
55% below our estimate, below the bear case
Fundamentals snapshot
Village Farms International, Inc.
VFF · NCM · Consumer Defensive · Farm Products
Current price
$2.88
52-week range
$1.80 - $4.99
Market cap
$352.18M
Balance sheet
Healthy
10.13x Adequate
Net cash $26.74M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Returns 7.5% on equity, ahead of 80% of its peers.
- Reward Free cash flow was positive in 4/10 years.
- Reward Trades at 16.0x P/E vs peer median 22.6x (29.1% cheaper).
- Risk Stock trades 18.4% above its 5-year average P/E.
What this company does
Village Farms International, Inc.
Village Farms International grows and sells fresh produce like tomatoes and peppers, as well as cannabis products in different countries. The money they make comes from selling these vegetables and from their cannabis business, which is important because it shows where their main sales are happening.
How the company got here
Village Farms International started in 1989, focusing on growing tomatoes, bell peppers, and cucumbers in large greenhouses. For years, its main business was supplying fresh produce to supermarkets across North America. A significant shift occurred as the company expanded into the cannabis market, recognizing the growing legal and commercial opportunities. This diversification into cannabis, both in Canada and the U.S., alongside its established produce business, has shaped its current identity.
What it actually does
Village Farms International is primarily a grower and distributor of fresh produce and cannabis products. Think of them as a large-scale farmer that uses advanced greenhouse technology to grow vegetables like tomatoes and peppers year-round. They also have a significant presence in the legal cannabis industry, producing and selling cannabis for medical and recreational use. Their operations span across North America and the Netherlands, serving both retail consumers and other businesses.
Produce
This is Village Farms' original business, where they grow and sell greenhouse-grown tomatoes, bell peppers, and cucumbers. They market these fresh vegetables under their own brand name, selling them to major retail supermarkets and food distributors. This segment represents their long-standing expertise in large-scale agriculture and provides a stable foundation for the company.
Cannabis - Canada
In Canada, Village Farms operates in the legal cannabis market, producing and supplying cannabis products. They sell these products to provincial governments and other licensed companies within Canada. This segment also involves developing and marketing cannabinoid-based health and wellness products, such as edibles and topical applications, catering to the growing demand for alternative health solutions.
Cannabis - U.S.
Village Farms is also involved in the U.S. cannabis market, focusing on the development and sale of cannabinoid-based health and wellness products. While the legal landscape for cannabis in the U.S. is complex and varies by state, the company aims to leverage its expertise to capture opportunities in this expanding sector. This segment is geared towards products that can be sold across different U.S. states where regulations permit.
Cannabis – Netherlands
This segment involves Village Farms' operations in the Netherlands, where they produce and supply cannabis products. They cater to specific markets within the Netherlands, including supplying designated coffee shops. This international presence diversifies their cannabis business beyond North America.
Clean Energy
Village Farms also has a Clean Energy segment, which focuses on producing power. While not their primary focus, this business line likely utilizes the infrastructure and technology from their large greenhouse operations, potentially generating energy for their own facilities or selling excess power. This adds another dimension to their revenue streams beyond agriculture and cannabis.
What management is betting on now
Village Farms' management is strategically focused on expanding its presence in the legal cannabis markets, both in Canada and the U.S., while continuing to strengthen its core produce business. They are investing in developing a wider range of cannabinoid-based health and wellness products to meet evolving consumer preferences. The company is also looking to optimize its greenhouse operations for efficiency and potentially explore new agricultural technologies. This dual approach aims to balance the stability of their produce sales with the high-growth potential of the cannabis industry.
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.
FY2024 Q3
$1.02M
FY2024 Q4
$-1.52M
FY2025 Q1
$-8.91M
FY2025 Q2
$23.28M
FY2025 Q3
$22.62M
FY2025 Q4
$300.00K
FY2026 Q1
$-25.99M
FY2026 Q2
$2.64M
Revenue
$63.98M
Net income
$7.14M
Diluted EPS
0.06
Operating cash flow
$8.88M
Free cash flow
$2.64M
Fetching…
Sources
Revenue
$50.24M
Net income
$2.92M
Diluted EPS
0.02
Operating cash flow
$-16.76M
Free cash flow
$-25.99M
Fetching…
Sources
Revenue
$12.22M
Net income
$2.43M
Diluted EPS
0.01
Operating cash flow
$11.40M
Free cash flow
$300.00K
Fetching…
Sources
Revenue
$66.74M
Net income
$10.22M
Diluted EPS
0.08
Operating cash flow
$24.45M
Free cash flow
$22.62M
Fetching…
Sources
Revenue
$59.90M
Net income
$26.50M
Diluted EPS
0.24
Operating cash flow
$26.03M
Free cash flow
$23.28M
Fetching…
Sources
Revenue
$77.07M
Net income
$-6.70M
Diluted EPS
-0.06
Operating cash flow
$-6.38M
Free cash flow
$-8.91M
Fetching…
Sources
Revenue
$82.55M
Net income
$-8.63M
Diluted EPS
-0.07
Operating cash flow
$412.00K
Free cash flow
$-1.52M
Fetching…
Sources
Revenue
$83.37M
Net income
$-820.00K
Diluted EPS
-0.01
Operating cash flow
$4.28M
Free cash flow
$1.02M
Fetching…
Sources
Is it cheap or expensive?
Fair value $6.42 vs current price $2.88
Wall Street consensus is the average analyst price target: $5.83 (-9.1% lower than our fair-value estimate).
Our most-likely fair value is $6.42 a share — about 122.8% above today's price of $2.88, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net cash $26.7M - more cash than debt. Interest coverage 10.1x.
Net debt
$-26.74M
Interest coverage
10.13x
Village Farms International, Inc.'s profit covers its interest bill about 10.1 times over. which is stronger than every peer shown here and 4 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
VFF
BASELINE
Village Farms International, Inc.
Total debt $46.19M Interest coverage 10.13x This is the baseline the peer rows are being compared against.
Total debt $115.22M Interest coverage -0.59x -100% vs VFF This peer has almost no interest-payment cushion compared with VFF.
Total debt $1.21M Interest coverage -1,499.77x -100% vs VFF This peer has almost no interest-payment cushion compared with VFF.
Total debt $16.10M Interest coverage -25.79x -100% vs VFF This peer has almost no interest-payment cushion compared with VFF.
Total debt $108.97M Interest coverage -15.48x -100% vs VFF This peer has almost no interest-payment cushion compared with VFF.
What you should know
The case for and against VFF
3 Rewards
1 Risk
Rewards
-
Returns 7.5% on equity, ahead of 80% of its peers.
-
Free cash flow was positive in 4/10 years.
-
Trades at 16.0x P/E vs peer median 22.6x (29.1% cheaper).
Risks
-
Stock trades 18.4% above its 5-year average P/E.
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)
16.00x
Forward P/E
12.52x
P/B
1.12x
P/S
1.53x
EV/EBITDA
6.19x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
44.3%
Operating margin
17.4%
Net margin
9.8%
ROE
7.5%
ROA
5.6%
Health
Liquidity and balance-sheet strength
Debt / equity
0.14x
Current ratio
3.17x
Quick ratio
2.11x
Total debt
$46.19M
Total cash
$72.93M
Growth
How the business has been compounding
Revenue TTM
$193.18M
Revenue 5Y CAGR
-5.3%
EPS TTM
0.18
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$27.96M
Free CF TTM
$39.89M
FCF margin
20.7%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
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