-
Premium Brands Holdings Corporation (PBH $95.58)
- $95.58 P/E (TTM): 45.83X Cap: $4.26B
- View PBH Profile
- View Questions on PBH
- View Reports on PBH
Review of Premium Brands Holdings Corporation
APR 03, 2025
- Its investment cycles have negatively impacted its earnings, but sales growth rates have been robust overall, and management is guiding for a strong FY2025. Valuation has compressed as its profit margins have slid lower and it is facing uncertain times with the threat of US tariffs. Management feels that it can navigate US tariffs well with its manufacturing plants that are positioned in the jurisdictions that it sells to. We believe that this could mark an inflection point for the company’s fundamentals, particularly as it has paused its dividend increases and plans to focus on business
acquisitions. Its price momentum over the past few years has been weak, but it offers an attractive dividend yield at these prices, and it has the potential to see multiple expansion if it can execute on its growth strategy for the coming years. We feel that management is taking the appropriate steps to turn the business in the right direction, and therefore we are maintaining our rating of ‘B’.
{tplLang.details | toLang tLang}
{tplLang.industryclassifications | toLang tLang}
{tplLang.toolname| toLang tLang}
-
Premium Brands Holdings Corporation (PBH $95.58)
- $95.58 P/E (TTM): 45.83X Cap: $4.26B
- View PBH Profile
- View Questions on PBH
- View Reports on PBH
-
Premium Brands Holdings Corporation (PBH $95.58)
- $95.58 P/E (TTM): 45.83X Cap: $4.26B
- View PBH Profile
- View Questions on PBH
- View Reports on PBH
It has completed its sale and leaseback of its Tennessee Sandwich Plant, and used the proceeds to repay a $172 debenture that matured in April, slightly reducing its total debt to EBITDA to 4.2:1 from 4:6:1 for the quarter.
They have also posted a 6 page letter from the CEO to Shareholders entitled “The Future of Food is the Past”
It would be appreciated if you could review both the results and the letter; and provide your comments, as well as sentiment on the company/strategy.
Thank-you!
-
Premium Brands Holdings Corporation (PBH $95.58)
- $95.58 P/E (TTM): 45.83X Cap: $4.26B
- View PBH Profile
- View Questions on PBH
- View Reports on PBH
A question dated July 23 had this portion of an analyst's opinion on PBH:
Assuming that 1) the Distribution Group is sold at a reasonable valuation and 2) the "new" PBH is re-rated back up to a trading range of 12-13x (i.e., historical ten-year average is ~12.5x; we are using 9.0x to derive our June 2026 target price of $140), we think that a hypothetical divestiture and subsequent debt repayment implies a share price anywhere between $205 to $225 at the end of 2026, ~50-60% above our current $140 target.
~~~~~~~~~~~~~~~~~
Does this defy logic, gravity or both? Can a stock that has been dead money for more than 5 years more than double in a year and a half? The $140 target seems optimistic, but over $200 is mind boggling.
Thanks,
Greg