JJSF
J&J Snack Foods Corp.
$74.55
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Overvalued
Trading 2.2% above fair value
You pay
$74.55
Bear
$60.08
Fair
$72.96
Bull
$85.83
Bear
$60.08
-19.4%
$4.06 × 15x P/E
Fair
$72.96
-2.1%
$4.06 × 18x P/E
Bull
$85.83
+15.1%
$4.06 × 21x P/E
Key Value Driver
Normalized P/E multiple (18x base case)
Implied Market Multiple
18.4x
Summary
Applying a 18x P/E to adjusted EPS of $4.06, the base-case value is $72.96 per share. DDM cross-check: $99.74.
Warnings
The company pays out 95% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Dividend-based valuation: $99.74 (above our primary estimate by 37%). Large gaps may signal the dividend doesn't reflect full earning power.
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