The Simply Good Foods Company
The Simply Good Foods Company Fundamental Analysis
The Simply Good Foods Company (SMPL) shows weak financial fundamentals with a PE ratio of 18.51, profit margin of 6.26%, and ROE of 5.04%. The company generates $1.4B in annual revenue with moderate year-over-year growth of 8.98%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 48.8/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze SMPL's fundamental strength across five key dimensions:
Efficiency Score
WeakSMPL struggles to generate sufficient returns from assets.
Valuation Score
ExcellentSMPL trades at attractive valuation levels.
Growth Score
ModerateSMPL shows steady but slowing expansion.
Financial Health Score
ExcellentSMPL maintains a strong and stable balance sheet.
Profitability Score
WeakSMPL struggles to sustain strong margins.
Key Financial Metrics
Is SMPL Expensive or Cheap?
P/E Ratio
SMPL trades at 18.51 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, SMPL's PEG of -1.59 indicates potential undervaluation.
Price to Book
The market values The Simply Good Foods Company at 0.97 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 8.75 times EBITDA. This is generally considered low.
How Well Does SMPL Make Money?
Net Profit Margin
For every $100 in sales, The Simply Good Foods Company keeps $6.26 as profit after all expenses.
Operating Margin
Core operations generate 14.36 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $5.04 in profit for every $100 of shareholder equity.
ROA
The Simply Good Foods Company generates $3.70 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
The Simply Good Foods Company produces operating cash flow of $189.07M, showing steady but balanced cash generation.
Free Cash Flow
The Simply Good Foods Company generates strong free cash flow of $167.58M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $1.76 in free cash annually.
FCF Yield
SMPL converts 10.81% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
18.51
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-1.59
vs 25 benchmark
P/B Ratio
Price to book value ratio
0.97
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.11
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.26
vs 25 benchmark
Current Ratio
Current assets to current liabilities
5.007
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.05
vs 25 benchmark
ROA
Return on assets percentage
0.04
vs 25 benchmark
ROCE
Return on capital employed
0.09
vs 25 benchmark
How SMPL Stacks Against Its Sector Peers
| Metric | SMPL Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 18.51 | 23.25 | Better (Cheaper) |
| ROE | 5.04% | 1240.00% | Weak |
| Net Margin | 6.26% | -9728.00% (disorted) | Weak |
| Debt/Equity | 0.26 | 0.77 | Strong (Low Leverage) |
| Current Ratio | 5.01 | 2.54 | Strong Liquidity |
| ROA | 3.70% | -203388.00% (disorted) | Weak |
SMPL outperforms its industry in 3 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews The Simply Good Foods Company's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
65.80%
Industry Style: Defensive, Dividend, Low Volatility
High GrowthEPS CAGR
47.31%
Industry Style: Defensive, Dividend, Low Volatility
High GrowthFCF CAGR
182.64%
Industry Style: Defensive, Dividend, Low Volatility
High Growth