JBSS
John B. Sanfilippo & Son, Inc.
$76.71
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Fair Value
Trading 10.8% below fair value
You pay
$76.71
Bear
$70.82
Fair
$86.00
Bull
$101.17
Bear
$70.82
-7.7%
$5.06 × 14x P/E
Fair
$86.00
+12.1%
$5.06 × 17x P/E
Bull
$101.17
+31.9%
$5.06 × 20x P/E
Key Value Driver
Normalized P/E multiple (17x base case)
Implied Market Multiple
15.2x
Summary
Applying a 17x P/E to adjusted EPS of $5.06, the base-case value is $86.00 per share.
Warnings
The company pays out 121% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples