K Fair Value Estimate
$70.2115.9% overvalued
Blended fair value estimate based on DCF, Graham Number, and earnings-based models.
Kellanova
Exchange: NYSESector: Consumer DefensiveIndustry: Packaged Foods
Kellanova is a leader in global snacking, international cereal and noodles, and North America frozen foods with a legacy stretching back more than 100 years. Powered by differentiated brands including Pringles®, Cheez-It®, Pop-Tarts®, Kellogg's Rice Krispies Treats®, RXBAR®, Eggo®, MorningStar Farms®, Special K®, Coco Pops®, and more, Kellanova's vision is to become the world's best-performing snacks-led powerhouse, unleashing the full potential of our differentiated brands and our passionate people. Our net sales for 2023 were $13 billion. At Kellanova, our purpose is to create better days and ensure everyone has a seat at the table through our trusted food brands. We are committed to promoting sustainable and equitable food access by tackling the crossroads of hunger, sustainability, wellbeing, and equity, diversity & inclusion. Our goal is to create Better Days for 4 billion people by the end of 2030 (from a 2015 baseline).
Did you know?
Capital expenditures decreased by 7% from FY23 to FY24.
Current Price
$83.44
GoodMoat Value
$70.21
15.9% overvaluedProfile
Valuation (TTM)
Market Cap$29.01B
P/E22.72
EV$34.97B
P/B7.68
Shares Out347.67M
P/Sales2.29
Revenue$12.67B
EV/EBITDA15.61
Kellanova (K) Valuation
GoodMoat Analysis
Kellanova appears unfavourable from a value investing perspective, trading at a premium to its estimated intrinsic value with a minimal margin of safety. Its P/E multiple is significantly higher than the sector average and its own historical earnings-based valuation, suggesting the current price is expensive relative to its quality.
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The primary valuation tool, the GoodMoat Target of $70.21, indicates Kellanova's current price of $83.44 is approximately 19% above this fair value estimate. This results in a negative margin of safety, placing it firmly in the 'Unfavourable' band per the framework's DCF-based thresholds (which require a 20%+ margin of safety to be considered Favourable). The forward P/E of 22.7x is a key point of concern. For a mature, low-growth packaged foods company, this multiple is high, especially when compared to a typical sector average in the mid-to-high teens. It also represents a significant premium to the stock's own P/E based on its current EPS of $3.88. Supporting this view, the free cash flow yield of 3.9% is modest, and the elevated debt/equity ratio of 1.68 adds financial risk without a corresponding growth profile to justify it. Integrating this with the framework's decision logic, the stock fails the Valuation & Risk Gate due to the lack of a margin of safety and elevated valuation multiples relative to its business profile. Analysis based on data as of 2024-05-15.
K Valuation Metrics
FCF$1.13B
FCF Growth Rate2.82%
EPS Growth (CAGR)2.82%
WACC10.00%
Fair Value Models
Graham Number, PEG-based, and Earnings-based models
View Fair Value →K Valuation & Fair Value Analysis
Kellanova (K) valuation analysis using multiple fair value methodologies. GoodMoat calculates a blended fair value target using discounted cash flow (DCF) analysis, the Graham Number, and earnings-based valuation models.
The GoodMoat Fair Value target for Kellanova is $70.21. The current stock price is $83.44, suggesting the stock is 18.8% overvalued.
The price-to-earnings (P/E) ratio is 22.72. Price-to-book ratio is 7.68. Price-to-sales ratio is 2.29. Enterprise value to EBITDA is 15.61. PEG ratio is -1.35.
GoodMoat's valuation models include the Graham Number (based on EPS and book value), an earnings-based model (discounted future EPS), and a PEG-adjusted valuation. The three models are averaged to produce a blended fair value estimate. Use these tools alongside the DCF calculator and reverse DCF to form a comprehensive view of Kellanova's intrinsic value.