Stock (Symbol) |
Hain Celestial (HAIN) |
Stock Price |
$41 |
Sector |
| Food & Necessities |
Data is as of |
| November 16, 2015 |
Expected to Report |
| Feb 2 – Feb 8 |
Company Description |
 The Hain Celestial Group, Inc. manufactures, markets, distributes and sells natural and organic products under brand names, which are sold as better-for-you products. It is engaged in natural and organic products categories, with brands such as Earth’s Best, Celestial Seasonings, Terra, Garden of Eatin’, Sensible Portions, Rice Dream, Soy Dream and Almond Dream. It operates in three segments: the United States, the United Kingdom, which covers the United Kingdom and Ireland, and Rest of World. On January 13, 2014, The Hain Celestial Group Inc acquired Tilda Limited and Brand Associates Limited. Source: Thomson Financial |
Sharek’s Take |
 Hain Celestial (HAIN), known for its Celestial Seasonings tea, is a leader in healthy and organic food with 47 brands and counting. HAIN had been a hot stock as it went from $10 to $70 in just five years but when it did so the P/E went higher too. Two qtrs ago the stock sold for 31x earnings, which is quite high for a 15% grower. Last qtr HAIN fell to $52, or 24x earnings, and I bought the stock in the Growth Portfolio. Since then the stock has continued to decline, and now at $41 it sells for just 19x next year’s earnings. Hain Celestial has suffered through a huge correction, but the stock needed to come down as it was overvalued. Food manufacturers rarely sell for 30x earnings as HAIN did, but more like 20x. When the stock was around $70 I felt it was worth around $55 and I continue to believe so today. I feel at $41 HAIN is very undervalued and has solid upside to its Fair Value. |
One Year Chart |
 This stock has been on a ride the past few months. Although profit growth was just +9% last qtr, and could be +9 next qtr, qtrly growth looks to accelerate to +24%, +15% and +15% the first 3 qtrs of 2016. HAIN did miss profit estimates by a penny last qtr, and had annual estimates lowered a bit, but these annual figures have been in a tight range the last 4 qtrs. |
Fair Value |
 From 2012 to 2015 the stock had a median P/E of around 30 — which I felt was too high. But now the 19 P/E is quite low. Hain Celestial will continue to acquire other companies, and that will help fuel growth, so these profit estimates could be raised in the coming year. At this price, HAIN has solid upside. |
Bottom Line |
 Outside the recession years, Hain Celestial has been a good stock to invest in. I only wish I would have waited a couple of months to get in at a lower price. Still, the company is a food manufacturer which gives the stock a high degree of certainty as people gotta eat. Hain Celestial gives investors the broadest exposure to the organic food industry and the stock is the cheapest its been in years.HAIN is ranked 17th of 32 stocks in the Growth Portfolio Power Rankings. If you don’t own the stock already this is a rare opportunity to buy low. |
Power Rankings |
Growth Stock Portfolio
17 of 32Aggressive Growth Portfolio N/AConservative Stock Portfolio N/A |
