Crown Crafts (CRWS) Company Overview & Stock Price Forecast
This article provides a brief analysis and stock rating for Crown Crafts (CRWS) including an updated stock price target. Additional data on the company’s earnings yield, price/earnings ratio, return on invested capital and YTD performance are discussed as well.
Crown Crafts Fundamentals
Stock Price Target: $10.02
In the section below, we discuss the earnings yield, P/E, return on invested capital and YTD performance for Crown Crafts in comparison to the Apparel industry and the S&P 500.
Craft Crafts is a Micro Cap company with a Market Cap of $67.9M.
How are investors using Crown Crafts earnings yield to assess the company?
The earnings yield is used to show the percentage of a company’s earnings per share. Investors typically use earnings yield to determine which assets are underpriced or overpriced relative to other variables, like sector, industry or bond yields. Simply put, the earnings yield of a company can be used to assess how expensive a company is in relation to the earnings that are generated. When valuing companies, the SIS Research Group does not utilize the inverse P/E ratio to calculate the earnings yield. Instead, we use an adjusted earning yield calculation to capture variation amongst companies (i.e. debt and tax rates).
The current earnings yield for Crown Crafts is 17.15%, in comparison to 3.86% for the S&P 500 and 2.48% for the 10-year treasury bond. The median earnings yield for the Apparel industry is 10.54%.
What does Crown Crafts Price-to-Earnings Ratio (P/E) tell investors about the company?
The price-to-earnings ratio (P/E) is a relatively popular metric used by investors and analysts for valuing a company’s stock. The P/E ratio can be used to show how a stock’s valuation compares to other companies and the total market. Investors use the P/E ratio to determine what the market is willing to pay today based on a company’s past or future earnings. A high P/E ratio could mean that a stock’s price is too high relative to earnings, which could be a signal that a stock is currently overvalued. In turn, a low P/E ratio could indicate that a company’s current stock price is low relative to earnings.
Crown Crafts is currently trading at a P/E of 8.43. The P/E for the Apparel industry is 21.85 and the P/E for the S&P 500 is 25.91.
What is the current Price-to-Sales Ratio (P/S) for Crown Crafts?
The Price-to-Sales Ratio (P/S) looks at a company’s market cap and revenue to determine valuation. The P/S ratio is calculated by taking a company’s market cap and dividing by the total sales or revenue. The P/S ratio gives an idea of how much the market values every dollar of a company’s sales and can be effective in valuing unprofitable growth stocks or companies that are currently undergoing special situations or challenges. A lower the P/S ratio can be an indicator of good value.
Crown Crafts is currently trading at a P/S of 0.82. The P/S for the Apparel industry is 1.52 and the P/S for the S&P 500 is 3.01.
How does Crown Crafts Price-to-BookRatio (P/B) compare to the Apparel industry?
Price-to-book value (P/B) is the ratio of the market value of a company’s shares divided by its book value of equity (the value of it’s assets on the books). The book value is the difference between the book value of assets and liabilities. Typically, investors use the P/B ratio to assess if a stock is valued properly (a value of one means that the stock price is trading in line with the book value of the company). A company with a high P/B ratio could mean the stock price is overvalued as well as the converse.
Crown Crafts P/B ratio is 1.54. The P/B for the Apparel industry is 3.83 and the P/B for the S&P 500 is 4.62.
How attractive is Crown Crafts Return on Invested Capital (ROIC) to investors?
Investors use the return on invested capital (ROIC) to assess how efficient a company is at turning capital into profits. The ROIC is the amount of money a company makes on it’s investments that is above the average cost of debt and equity.
Investors can use the ROIC to provide context for metrics like the (P/E) ratio. For instance, when used in isolation a low P/E ratio could suggest a company is oversold but the decline could be because a company is no longer generating value for shareholders. Conversely, companies that consistently generate high rates of ROIC can plausibly trade at a premium compared to other stocks, even if their P/E ratios are high.
Crown Crafts ROIC is currently 16.61% in comparison to 17.73% for the Apparel industry and 9.10% for the S&P 500.
How has CRWS stock performed over the past year? What is the current analyst price target?
Over the past 52 weeks, Crown Crafts has traded between the range of $6.07 and $7.86.
The current Analyst Price Target for Crown Crafts is $10.02.
What is Crown Crafts YOY Performance in comparison to its industry and the total market?
The YOY performance for Crown Crafts is -11.73%. The Apparel industry has a YOY performance of -2.43% in comparison to the YOY S&P 500 performance of 15.80%.
Recent Financial Results
- Net sales excluding Carousel Designs up 23.8% for the quarter and 14.6% year-to-date
- Net income for the third quarter of fiscal 2022 was $2.4M, on net sales of $22.7M, compared with net income of $2.1M, on net sales of $19.5M for the third quarter of fiscal 2021
- Gross profit for the current-year quarter was 27.1% of net sales, down from 31.6% of net sales in the prior-year quarter. The prior-year quarter included net sales and a net loss of $1.1M and $102,000, respectively, associated with the Carousel Designs business, which ceased operations in May 2021
- Quarterly cash dividend on the Company’s Series A common stock of $0.08 per share
Stock Price Target: $10.02
Crown Crafts operates in the consumer products industry in the United States and internationally. It provides infant, toddler, and juvenile products, including infant and toddler beddings; blankets and swaddle blankets; nursery and toddler accessories; room décors; and other goods. The company sells its products primarily to mass merchants, mid-tier retailers, juvenile specialty stores, value channel stores, grocery and drug stores, restaurants, internet accounts, wholesale clubs and internet-based retailers through a network of sales force and independent commissioned sales representatives.
Crown Crafts, Inc. was incorporated in 1957 and is headquartered in Gonzales, Louisiana. The current CEO is E. Randall Chestnut.
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This material is provided for informational purposes only and is not financial advice. The information contained herein should not solely be used for the formation of an investment decision, whether you are a long term or short term investor.