Asset Breakdown
629.4 M
Assets Non Current
826.5 M
Current Assets
| Total Assets | 1.46 Billion | |
| Current Assets | 826.48 Million | |
| Assets Non Current | 629.4 Million | |
| Goodwill | 52.38 Million | |
| Tax Assets | 40.45 Million |
Will Cal (USA Stocks:CALM) continue to grow in November?
 | By Aina Ster | Macroaxis Story |
Investors considering a position in Cal-Maine Foods (NASDAQ: CALM) should note the company's relatively low debt levels, which provide a strong foundation for future growth. With total liabilities of only 344.9 million, the company's balance sheet appears healthy, especially when compared to its net invested capital of 1.6 billion. This low debt level gives Cal-Maine Foods significant financial flexibility, allowing it to invest in growth opportunities or weather potential downturns. Moreover, the company's cost of revenue stands at 1.9 billion, indicating a substantial revenue generation capability. Despite a recent price percent change of -1.86, the company's strong financial position could make it an attractive investment for those seeking a leveraged position in the Farm Products industry.
Additional examination
Cal-Maine Foods currently has $1.44 million in liabilities, with a Debt to Equity (D/E) ratio of 0.0. This may suggest that the company is not leveraging debt effectively. The asset utilization indicator represents the revenue generated for every dollar of assets reported by the company. Cal-Maine has an asset utilization ratio of 160.97 percent, indicating that the company generates $1.61 for each dollar of assets. An increasing asset utilization ratio suggests that Cal-Maine Foods is becoming more efficient in utilizing its assets for daily operations.Macroaxis uses a strict editorial review process to publish stories and blog posts. Our publishers support our company and may receive a small commission when the partner links or references are utilized. Commissions do not affect the opinions or evaluations of our editorial team. The information our editors and media partners deliver is confidential and licensed for your sole use as a Macroaxis user. We reserve all rights to the content of this article, and therefore copying or distributing this story in whole or in part is strictly prohibited.
Reviewed by Raphi Shpitalnik
Cal-Maine Foods (NASDAQ: CALM), a player in the Consumer Defensive sector and Food Products service category, has been demonstrating a robust financial performance with a net income applicable to common shares of 758M and total assets amounting to 2B. The company's cash reserves are strong at 292.8M, providing a solid buffer for any unforeseen financial challenges. However, the company's debt level, reflected in liabilities and stockholders' equity, also stands at 2B, which could potentially offset its strong cash position. Despite this, the company has been able to maintain a healthy forward dividend yield of 0.1066, although it has paid out a significant 252.3M in dividends. The company's capital expenditures of 136.6M and other cashflows from financing activities at -375.1M indicate a significant reinvestment into the business. With three analyst estimates and one strong sell recommendation, investors should carefully consider the company's debt levels and future outlook before making an investment decision. The company's real value is currently estimated at 46.73. Cal-Maine Foods is set to announce its earnings today, with the subsequent financial report anticipated on December 27, 2023. Currently, Cal-Maine's Revenue Per Employee is quite stable, especially when compared to the previous year. Last year, the company reported a Revenue Per Employee of $546,263. As of October 3, 2023, the Interest Coverage is projected to increase to 66.74, while the Long Term Debt to Equity ratio is expected to decrease to 0.08. Despite the indifference of many baby boomers towards the food products sector, Cal-Maine Foods stands out as a distinctive choice for millennials. We will further analyze whether the company can maintain a manageable level of debt while reducing operating losses.Cal Maine financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Cal Maine, including all of Cal Maine's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Cal Maine assets, the company is considered highly leveraged. Understanding the composition and structure of overall Cal Maine debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.
Understanding Cal Total Liabilities
Cal Maine Foods liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. Cal Maine Foods has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on Cal Maine balance sheet include debt obligations and money owed to different Cal Maine vendors, workers, and loan providers. Below is the chart of Cal short long-term liabilities accounts currently reported on its balance sheet. You can use Cal Maine Foods financial leverage analysis tool to get a better grip on understanding its financial positionHow important is Cal Maine's Liquidity
Cal Maine financial leverage refers to using borrowed capital as a funding source to finance Cal Maine Foods ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Cal Maine financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Cal Maine's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Cal Maine's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Cal Maine's total debt and its cash.
An Additional Perspective On Cal Maine Foods
The modest gains experienced by current holders of Cal Maine could raise concerns from insiders as the firm is trading at a share price of 47.52 on 982,629 in volume. The company executives have been quite successful in maneuvering the stock at opportune times to take advantage of all market conditions in September. The stock standard deviation of daily returns for 90 days investing horizon is currently 1.27. The below-average Stock volatility is a good sign for longer-term investment options and for buy-and-hold investors.
Cal-Maine Foods (NASDAQ: CALM), a prominent player in the Farm Products industry, has recently been under the microscope for its financial health. The company boasts a robust current ratio of 3.38X, indicating a strong ability to meet short-term obligations. With a net asset value of $1.95B and a significant end period cash flow of $292.8M, Cal-Maine Foods appears to be in a stable financial position. The company's EBITDA stands at $1.06B, with EBIT close behind at $985.4M, demonstrating a strong earning capacity. However, the operating margin is a mere 0.31%, indicating that the company's operational efficiency could be improved.The five-year return on investment for Cal-Maine Foods is 2.87%, which is a modest figure but not without potential for growth. Cal-Maine Foods' debt levels are also worth noting. The company's net debt stands at a negative $292.8M, suggesting that it has more cash than debt. This is further supported by the company's debt to equity ratio, which is a negligible 0.001%. Looking forward, the company's price to earnings to growth (PEG) ratio is 0.75X, indicating that the stock may be undervalued given its earnings growth. With a forward dividend yield of 0.1066, investors could also benefit from regular income. In conclusion, Cal-Maine Foods' strong liquidity, low debt levels, and potential for growth make it an attractive investment opportunity. However, investors should also consider the company's modest return on investment and low operating margin. .
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