Mondelez International shares fell by -1.1% during the day's afternoon session, and are now trading at a price of $70.11. Is it time to buy the dip? To better answer that question, it's essential to check if the market is valuing the company's shares fairly in terms of its earnings and equity levels.
Mondelez International's Valuation Is in Line With Its Sector Averages:
Mondelez International, Inc., through its subsidiaries, manufactures, markets, and sells snack food and beverage products in the Latin America, North America, Asia, the Middle East, Africa, and Europe. The company belongs to the Consumer Staples sector, which has an average price to earnings (P/E) ratio of 21.21 and an average price to book (P/B) ratio of 4.12. In contrast, Mondelez International has a trailing 12 month P/E ratio of 19.4 and a P/B ratio of 3.34.
Mondelez International's PEG ratio is 2.39, which shows that the stock is probably overvalued in terms of its estimated growth. For reference, a PEG ratio near or below 1 is a potential signal that a company is undervalued.
Wider Gross Margins Than the Industry Average of 24.63%:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $25,938 | $25,868 | $26,581 | $28,720 | $31,496 | $35,397 |
| Gross Margins | 40% | 40% | 39% | 39% | 36% | 38% |
| Net Margins | 13% | 15% | 13% | 15% | 9% | 13% |
| Net Income (M) | $3,317 | $3,929 | $3,555 | $4,300 | $2,717 | $4,592 |
| Net Interest Expense (M) | $462 | $484 | -$608 | -$447 | -$423 | -$344 |
| Depreciation & Amort. (M) | $811 | $1,047 | $1,116 | $1,113 | $1,107 | $1,190 |
| Diluted Shares (M) | 1,470 | 1,453 | 1,439 | 1,413 | 1,385 | 1,370 |
| Earnings Per Share | $2.23 | $2.69 | $2.47 | $3.04 | $1.96 | $3.35 |
| EPS Growth | n/a | 20.63% | -8.18% | 23.08% | -35.53% | 70.92% |
| Avg. Price | $37.69 | $47.11 | $50.94 | $57.72 | $62.1 | $69.715 |
| P/E Ratio | 16.75 | 17.32 | 20.54 | 18.86 | 31.52 | 20.81 |
| CAPEX (M) | $1,095 | $925 | $863 | $965 | $906 | $1,065 |
| EV / EBITDA | 17.01 | 16.88 | 17.99 | 16.87 | 22.61 | 17.34 |
| Total Debt (M) | $15,180 | $15,788 | $20,017 | $19,296 | $20,634 | $16,411 |
| Net Debt / EBITDA | 3.41 | 2.96 | 3.3 | 2.73 | 4.03 | 2.34 |
| Current Ratio | 0.45 | 0.5 | 0.66 | 0.74 | 0.6 | 0.61 |
Mondelez International has rapidly growing revenues and a flat capital expenditure trend and wider gross margins than its peer group. Additionally, the company's financial statements display positive EPS growth and healthy leverage levels. However, the firm has not enough current assets to cover current liabilities because its current ratio is 0.61.
