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Long Hain Celestial
Long Hain Celestial
Rating!
Company!
Buy!
Hain Celestial
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62.90!
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Current Price!
Target Price in One Year!
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Stock Price
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Bull 81.46
Base 72.59
Bear 65.38
U.S.
Exchange
Ticker!
New York
Nasdaq
HAIN
We see a strong sales growth in the U.S. markets. Throughout the past two
decades, the consumer demand for organically produced goods has been
increasing dramatically with CAGR of 12.2%. According to recent industry
statistics, organic sales have expanded in all food categories since 2005, which
account for over 4 percent of total U.S. food sales. In the coming years, industry
revenue is expected to grow further as the result of several economic factors.
Firstly, the U.S. economy continues to recover from the previous financial
crisis, indicating that the disposable income of American families is projected to
increase over the next five years. Secondly, the Consumer Confidence Index
(CCI) reaching the highest level since 2007 may change their diet choices. The
shift in consumer attitudes and purchasing behavior suggests that consumers
now show more concerns regarding health, environment, and animal welfare, all
of which are demonstrated in the fundamental values of organic food.
Source: USDA&UWMadison
Organic products have become more accessible. The natural food retail
chains are now expanding in an unprecedented level due to the rising consumer
demand for organic foods. Whole Foods Market, for example, specializing in
natural and organic foods, the company owns about 50 brands and sells 5,000
products around the world. As retail channels become more and more diverse,
consumers could gain more access to all kinds of organic products.
Source: Seeking Alpha
Source: 10K
Hain owns the most diverse set of organic product portfolio by frequent
acquisitions. Compared to its peers such as General Mills and WhiteWave
Foods, Hain owns the largest number of brands by constantly acquiring organic
food producers throughout the years and adding them to its product mix. With its
40 plus brands, Hains products cover 10 of the 15 highest penetration categories
across organic and natural industry. Along with its impressive brand quantity,
Hain owns several giants in the organic goods space. Its top performing
company is Earths Best, which makes organic food products for infants,
toddlers and children. Earth's Best has 2.6 percent of the market share.
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International Sales Representation
in Net Global Sales
Source: 10K
Hain has a strong global expansion momentum. Its products are sold to
customers in more than 65 countries. International sales have been continuously
growing in the past three fiscal years. Its business in both U.S. and U.K. posted
record sales. It has also forged a partnership withHutchison Whampoa Limited,
billionaire Li Ka Shings retail and financial colossus, to take on Chinese market
and other emerging markets such as Thailand, Indonesia and Vietnam.
Irwin Simon
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Source: Google
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Why Should We Invest in Hain Now?
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Source: Google
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Hain is actively involved in product innovation and penetration to ecommerce. In order to open up broader growth channels, Hain is investing in
products with digital initiatives and e-commerce platforms that exemplify high
standards for quality. During the Natural Products Expo West 2015, over 100
new products of Hain were featured. These brands and the new product
innovation demonstrate Hains continued leadership in the organic and natural
space.
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Source: Google
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Strongest USD in a Decade
Source: Investing.com
Valuation !
Financial Discussion
Bear
12.50%
Sales Growth (%)
73.63%
COGS (% of Sales)
14.44%
SG&A (% of Sales)
30.00%
Effective Tax Rate
Perpetual Growth Rate 2.75%
6.52%
WACC
61.80
Implied Share Price
Base
15.50%
73.63%
14.44%
30.00%
3.00%
6.52%
76.23
Bull
18.50%
73.63%
14.44%
30.00%
3.25%
6.52%
93.96
2015
2,487.87
1,831.83
656.04
2016
2,873.49
2,115.76
757.73
Projected Year
2017
2018
3,318.88
3,833.31
2,443.71
2,822.48
875.17
1,010.83
Sales
COGS
Gross Profit
2012
1,378.00
996.00
382.00
2019
4,427.47
3,259.97
1,167.50
SG&A
EBITDA
% Margin
230.00
152.00
11.03%
275.00
200.00
11.53%
311.00
257.00
11.93%
359.21
296.84
11.93%
414.88
342.84
11.93%
479.19
395.99
11.93%
553.46
457.36
11.93%
639.25
528.25
11.93%
1.40
150.60
10.93%
26.00
174.00
10.03%
28.00
229.00
10.63%
28.00
268.84
10.81%
28.00
314.84
10.96%
28.00
367.99
11.09%
28.00
429.36
11.20%
28.00
500.25
11.30%
Less: Interest
Less: Taxes
Net Income
17.30
41.15
92.15
20.49
34.32
119.19
20.14
70.10
138.76
20.14
74.61
174.08
20.14
88.41
206.29
20.14
104.35
243.49
20.14
122.77
286.45
20.14
144.03
336.08
1.40
20.43
0.33
72.78
26.00
72.88
(47.11)
119.42
28.00
41.61
(11.35)
136.50
28.00
41.61
(11.35)
171.83
28.00
41.61
(11.35)
204.03
28.00
41.61
(11.35)
241.23
28.00
41.61
(11.35)
284.20
28.00
41.61
(11.35)
333.82
Ticker
GIS
KRFT
WWAV
THS
HAIN
6.38
15.38
6844.10
6568.10
64.57
15.88
7066.60
6790.60
66.76
Implied EV
Implied Market Cap
Implied Share Price
16.88
7511.60
7235.60
71.13
EV / EBITDA (x)
LTM
13.9
18.9
22.6
13.7
16.4
17.3
25.3
17.38
7734.10
7458.10
73.32