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Kellanova Co K

Morningstar Rating
$55.64 −0.48 (0.86%)
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Company Report

Kellanova Earnings: Profit Gains Stand to Buoy Judicious Brand Spending; Shares Still a Bargain

Narrow-moat Kellanova’s competitive prowess was on display in its first three months as an independent organization—following the split from no-moat WK Kellogg in October. In the quarter, organic sales jumped 6.9% (as an 8% price increase was only partially offset by a 1% downdraft in volume), while the adjusted gross margin expanded 290 basis points to 33.9% and adjusted operating margin shot up 270 basis points to 12.3% (on the heels of price bumps and culled inefficiencies).

Price vs Fair Value

K is trading within a range we consider fairly valued.
Price
$56.11
Fair Value
$67.00
Uncertainty
Medium
1-Star Price
$736.35
5-Star Price
$67.20
Economic Moat
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Capital Allocation
Wymcrdgj

Bulls Say, Bears Say

Bulls

Kellanova's European arm has shown it can win even in an intensely competitive landscape, where private label has pronounced share and retail consolidation has run rampant. This is evidenced by the segment's 23 consecutive quarters of organic sales growth.

Bears

Like peers, Kellanova has strained to keep up with the rapid evolution of consumer trends, weighing on volume growth.

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News

Trading Information

Previous Close Price
$56.12
Day Range
$55.3355.95
52-Week Range
$47.6367.84
Bid/Ask
$55.62 / $55.66
Market Cap
$18.92 Bil
Volume/Avg
330,613 / 2.8 Mil

Key Statistics

Price/Earnings (Normalized)
13.65
Price/Sales
1.47
Dividend Yield (Trailing)
4.17%
Dividend Yield (Forward)
3.99%
Total Yield
4.75%

Company Profile

Following its split from the North American cereal business, Kellanova (previously the global snacking arm of Kellogg) is a leading global manufacturer and marketer of salty snacks, snack bars, frozen breakfast fare, meat alternatives, and other packaged foods. Its offerings are manufactured in around 20 countries and marketed in more than 180 countries. Its product mix includes well-known brands such as Pringles, Cheez-It, Rice Krispies Treats, Pop-Tarts, Eggo, Nutri-Grain, and Morningstar Farms. Sales beyond its home turf account for about half of Kellanova's consolidated sales base.
Sector
Consumer Defensive
Industry
Packaged Foods
Stock Style Box
Mid Value
Total Number of Employees
23,000

Competitors

Valuation

Metric
K
NSRGY
CPB
Price/Earnings (Normalized)
13.6520.0414.53
Price/Book Value
6.026.463.35
Price/Sales
1.472.681.36
Price/Cash Flow
11.9316.409.68
Price/Earnings
K
NSRGY
CPB

Financial Strength

Metric
K
NSRGY
CPB
Quick Ratio
0.360.490.35
Current Ratio
0.660.830.97
Interest Coverage
4.108.566.49
Quick Ratio
K
NSRGY
CPB

Profitability

Metric
K
NSRGY
CPB
Return on Assets (Normalized)
7.20%10.01%7.16%
Return on Equity (Normalized)
33.62%34.58%23.99%
Return on Invested Capital (Normalized)
12.68%14.97%12.02%
Return on Assets
K
NSRGY
CPB
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