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Quote this valuation with its source: Fair value, Potential value and the price at analysis.
FAQ
SJM — frequently asked questions
Is The J.M. Smucker Company overvalued?
In our latest published analysis dated 2026-10-12, SJM looks meaningfully overvalued. The price recorded at analysis is 120 USD versus our fair value of 81,0 USD; the high endpoint is presented separately as potential value of 167 USD. That implies roughly 32.5% downside to fair value at that date.
Our latest published report, analyzed 2026-10-12, gives SJM a fair value of 81,0 USD and a potential value of 167 USD. The conclusion is triangulated across multiple valuation models and weighted by reliability for The J.M. Smucker Company's archetype; it is a dated research output, not a live price.
Should I buy SJM now?
Our latest published rating for SJM, analyzed 2026-10-12, is Sell. The J.M. Smucker Company looks meaningfully overvalued at the analysis-date price of 120 USD versus fair value of 81,0 USD; potential value is 167 USD. This is research for educational purposes, not personalized investment advice.
What are the biggest risks for SJM?
The dedicated bear-case section in our report analyzed 2026-10-12 documents The J.M. Smucker Company's material risks, evidence, thresholds, and thesis-invalidation conditions. Scenario-specific explanations remain in that section so the report does not repeat or decontextualize them elsewhere.
What is SJM's rating?
Our latest published rating for SJM, analyzed 2026-10-12, is Sell, with a published moat assessment of 6.5/10 (Narrow). It reflects our fair value of 81,0 USD, the potential value of 167 USD, and the price recorded at analysis (120 USD).
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§1 Resumen ejecutivoEN
Respuesta en 30 segundosSell
Precio frente a valor
Precio
$120.02
Valor razonable
$81.01
Valor potencial
$167.37
A fecha de
2026-10-12
Por qué puede funcionar
Acceleration of Uncrustables scaling past $1.0B in annual sales paired with sustained double-digit coffee segment margins could accelerate debt reduction beyond the $1.1B annual free cash flowguidance, driving faster-than-modeled credit metric normalization.
Qué cambiaría nuestra opinión
Consolidated operating margin fails to reach 14.5% in FY2027 due to sustained green coffee cost spikes and retailer resistance to further price increases.
We assign a Sell rating to The J.M. Smucker Company (SJM) with a fair value of $81.01, representing 32.5% downside from the October 12, 2026 share price of $120.02.3
The J.M. Smucker Company faces an acute disconnect between market expectations and intrinsic economic earning power. While the company delivered an impressive Q1 FY2027 headline earnings beat with adjusted EPS jumping 71% to $3.24, $0.84 per share of this result was driven by approximately $115.0M in non-recurring tariff refunds. Filtering out this one-time windfall reveals underlying operational deceleration across several key product categories, most notably in the newly acquired Sweet Baked Snacks segment where net sales fell 7% and volume/mix contracted 8%.
SJM carries a heavy leverage overhang following the Hostess Brands transaction. Total debt stands at $6,940,199,936 with an annual burden of approximately $335.0M and a high pre-tax of 14.55%. While management has committed all excess ($1.1B guided in FY2027) to debt paydown, debt service consumes nearly a third of , constraining capital return flexibility and elevating equity risk if macroeconomic conditions soften.
Our multi-model valuation synthesizes four distinct perspectives: Forward Earnings ($93.33 midpoint, 35% weight), Owner Earnings ($19.40 midpoint, 35% weight), Enterprise FCFFDCF ($77.70 midpoint, 15% weight), and Multi-Stage Moat Fade ($199.34 midpoint, 15% weight). Forward Earnings anchors on post-turnaround normalized earning power of $10.77 FY2027 EPS and $9.04 FY2028 EPS, while Owner Earnings captures the drag of FY2026 GAAP net loss of -$138.7M and ongoing maintenance capital expenditures ($317.4M). Blending these models produces an intrinsic fair value of $81.01.1,4
At $120.02, shares trade at a 48.2% premium to fair value and price in an unrealistic operational recovery without reflecting center-store volume elasticity and interest rate sensitivity. With consensus EPS expected to contract 16.1% in FY2028 to $9.04 as tariff refunds fade, the current market valuation offers an unfavorable risk-reward profile with -32.5% implied return. We recommend selling the stock.1
Leading category market shares across Folgers, Dunkin', Café Bustelo, Jif, Smucker's, and Uncrustables generate high brand awareness and repeat purchase loyalty, supporting $3,304.9M in FY2026 U.S. Retail Coffee revenue and $1,853.9M in Frozen Handheld and Spreads. In Q1 FY2027, coffee demonstrated 10 percentage points of net price realization alongside 2% volume growth.5
Distribution Network Scale and Breadth
Direct-to-store distribution capabilities and extensive commercial relationships across traditional grocery, mass merchandisers, club stores, and institutional channels ($879.0M Away From Home revenue in FY2026) create high route-to-market density that rivals cannot easily replicate.5
Cycle upside
A bull cycle in packaged foods occurs when consumer purchasing power strengthens, input costs moderate, and branded food manufacturers drive organic volume growth while preserving pricing gains and expanding premium product tiers.
Recomendación de la casa
Sell: At $120.02, SJM trades 48.2% above its intrinsic fair value of $81.01. We advise investors to liquidate long holdings and avoid new capital commitments.3
Descripción general de la empresa
The J.M. Smucker Company manufactures and markets branded food and beverage products across North America, focusing primarily on consumer staple grocery categories. In FY2026, the company generated $9,050.9M in net sales, with the vast majority ($8,568.2M) originating in the United States and $482.7M internationally.
The business operates across five reportable operating segments: U.S. Retail Coffee ($3,304.9M revenue in FY2026), featuring Folgers, Dunkin', and Café Bustelo; U.S. Retail Frozen Handheld and Spreads ($1,853.9M), led by Jif peanut butter, Smucker's fruit spreads, and rapidly growing Uncrustables sandwiches; U.S. Retail Pet Foods ($1,600.0M), including Milk-Bone and Meow Mix; Sweet Baked Snacks ($971.3M), encompassing the acquired Hostess Brands portfolio; and Away From Home ($879.0M), serving commercial and institutional customers.
§2 Caso bajistaEN
A combined stress test simulating severe green coffee input inflation alongside persistent Sweet Baked Snacks volume contraction demonstrates acute equity vulnerability. In this event, consolidated operating margins fail to normalize above 14.5% ($360.2M operating income on $9,050.9M revenue in FY2026 was only 3.98%,), while annual free cash flow compresses below $800M. Slower debt paydown against $6,940,199,936 in total obligations prevents balance sheet de-risking, driving WACC from 8.26% toward 9.25% due to elevated borrowing costs. Under these compounding pressures, the market multiple de-rates toward peer trough levels of 10.0x forward earnings, in line with General Mills at 10.37x, resulting in severe valuation erosion.
Green coffee inflation spikes, and grocery retailer resistance prevents further price realization.
Sweet Baked Snacks volume contracts substantially each year, triggering further intangible write-downs.
Operating margin fails to exceed 14.5%, missing normalized targets.
High debt burden elevates refinancing costs, driving WACC above 9.25%.
In the downside risk scenario, severe green coffee inflation compresses coffee margins, private label gains share in center-store peanut butter and spreads, sweet baked snacks experience ongoing volume erosion, and high leverage slows credit metric improvement. Slower cash generation hinders debt retirement, keeping borrowing costs elevated and de-rating the valuation multiple toward peer trough levels.
Cómo puede fallar esta tesis
Severe commodity cost spike in green coffee combined with sweet snacks volume collapse compresses operating margins by over 300 bps below normalized expectations.
In FY2026, reported GAAP operating margin was only 3.98% ($360.2M operating income on $9,050.9M revenue,). Sweet Baked Snacks segment profit fell 13% in Q1 FY2027 to 12.6% margin. If green coffee prices surge and consumer trade-down prevents pass-through, consolidated EBIT margin fails to exceed 14.5%, missing the base assumption of 17.5%.3
Señales de alerta temprana a vigilar
Los cinco acontecimientos que debilitarían nuestra tesis de inversión.
Indicates green coffee cost inflation and promotional discounting exceed pricing realization, preventing recovery toward the base normalized margin of 17.5%.
Actual:3.98% GAAP in FY2026 ($360.2M operating income on $9,050.9M revenue,) / 23.1% GAAP in Q1 FY2027
The J.M. Smucker Company maintains a narrow economic moat grounded in premium brand intangible assets and deep retail distribution scale across core North American grocery aisles. The company commands dominant market share in domestic at-home coffee through Folgers, Dunkin', and Café Bustelo ($3,304.9M net sales in FY2026), alongside indispensable positions in peanut butter and spreads via Jif and Smucker's ($1,853.9M net sales). These heritage brands enjoy top-of-mind consumer awareness and prime center-store shelf placement that enable pricing pass-through during inflationary cycles.
Despite these brand advantages, SJM's moat is strictly narrow rather than wide. Switching costs in packaged foods are virtually non-existent for consumers, exposing commodity-adjacent categories like mainstream roast and ground coffee, peanut butter, and fruit spreads to continuous private label competition. In addition, the $5.6B acquisition of Hostess Brands introduced execution complexity and brand dilution, as evidenced by a $1.94B reduction in goodwill between FY2024 ($7,649.9M) and FY2025 ($5,710.0M), and continuing volume erosion (-8% volume/mix in Q1 FY2027). While normalized return on invested capital can exceed the 6.85% cost of equity once integration amortization subsides, pricing power is insufficient to confer a wide competitive moat.
Beneficio económico
Economic profit generation is currently constrained by transaction-related amortization and high leverage. Trailing return on invested capital of 5.86% sits below the company's 8.26% WACC, destroying economic value. SJM will only generate true economic profits if normalized operating margins reach 17.5% and cash flows successfully retire high-cost debt ($6,940,199,936 total debt).2,3
6.5/ 10
Narrow
Sources of advantage
01Brand Intangible Assets and Shelf-Space Dominance — Leading category market shares across Folgers, Dunkin', Café Bustelo, Jif, Smucker's, and Uncrustables generate high brand awareness and repeat purchase loyalty, supporting $3,304.9M in FY2026 U.S. Retail Coffee revenue and $1,853.9M in Frozen Handheld and Spreads. In Q1 FY2027, coffee demonstrated 10 percentage points of net price realization alongside 2% volume growth.Wide
02Distribution Network Scale and Breadth — Direct-to-store distribution capabilities and extensive commercial relationships across traditional grocery, mass merchandisers, club stores, and institutional channels ($879.0M Away From Home revenue in FY2026) create high route-to-market density that rivals cannot easily replicate.
Amenazas conocidas al foso
Amenaza
Severidad
Cronograma
Mitigación
Private label penetration in center-store peanut butter and fruit spreads as price-sensitive consumers trade down.
medium
12 to 24 months
Continuous product format innovation in Uncrustables sandwiches and targeted brand marketing campaigns supporting Jif and Smucker's brand loyalty.
Green coffee bean cost spikes exceeding retail pricing tolerance, triggering margin compression and demand elasticity.
The highlighted cell is Fair value when every assumption sits at its base level ($81.01). Each row and column shows what Fair value becomes when one assumption moves.
Free cash flow to the firm stays positive in the first projected year at $868.0M after modeled reinvestment of $217.0M, with terminal value at 74.8% of enterprise value. A sudden drop in free cash flow is not projected unless capital spending relative to revenue, reinvestment, or gross margin resets materially.
Adjusted EPS reaches $10.77 in FY2027 and $9.04 in FY2028.1
Annual free cash flow averages $1.1B, enabling sustained debt retirement against $6,940,199,936 in debt obligations.3
Weighted average cost of capital remains stable and terminal valuation multiples converge toward historical averages.
The base turnaround scenario models steady post-acquisition margin recovery, with consolidated operating margin normalizing toward 17.5% as integration costs subside. Coffee pricing power and Uncrustables volume gains offset moderate declines in pet food and sweet snacks, supporting adjusted EPS of $10.77 in FY2027 and $9.04 in FY2028. Free cash flow of $1.1B is dedicated to debt reduction, steadily lowering annual interest expense. Synthesized intrinsic fair value under this path is $81.01.
Uncrustables scales rapidly in annual net sales across retail and away-from-home channels.
Green coffee commodity costs stabilize, allowing U.S. Retail Coffee segment profit margins to expand significantly.
§7 Árbol de decisión de resultadosEN
Superado
Maintain Sell; Maintain defensive positioning, verify whether gross margin expansion reflects underlying volume growth rather than non-recurring tariff recoveries, and re-underwrite debt service capacity.
Disparador: Consolidated net sales exceeding $2.28B and adjusted EPS exceeding $2.65 in Q2 FY2027,
An earnings beat driven by coffee volume expansion or Hostess distribution gains signals improving operational execution, yet enterprise leverage remains elevated, leaving intrinsic value well below current trading levels.
En línea
Maintain Sell; Refrain from initiating exposure, track sweet baked snacks volume stabilization, and monitor progress toward full-year debt reduction targets.
Disparador: Consolidated net sales between $2.25B and $2.27B and adjusted EPS between $2.50 and $2.58 in Q2 FY2027,
In-line financial performance confirms the base turnaround schedule but reinforces that market pricing excessively discounts future margin recovery.
Fallo
Maintain Sell; Liquidate any residual exposure, review credit rating trajectory and refinancing covenants, and assess private label penetration.
Disparador: Consolidated net sales below $2.23B and adjusted EPS below $2.49 in Q2 FY2027,
A quarterly miss driven by green coffee cost inflation or persistent snacking volume contraction impairs operating cash conversion and stalls deleveraging.
Calidad de los beneficios
Quality of earnings is currently distorted by non-recurring items and accounting adjustments. In Q1 FY2027, reported adjusted EPS of $3.24 included an $0.84 per share benefit ($115.0M) from one-time tariff refunds. Excluding this refund, core adjusted operating EPS was $2.40. Furthermore, substantial recurring amortization of $57.9M per quarter and special project integration costs create a wide persistent gap between GAAP operating income ($360.2M in FY2026) and non-GAAP adjusted metrics, demanding close scrutiny of underlying cash earnings.4
Evolución de las estimaciones
Consensus estimate revisions turned upward following Q1 FY2027 earnings outperformance, with FY2027 consensus EPS rising 3.02% from $10.05 to $10.77 and FY2027 revenue rising 1.02% to $8,930M. However, FY2028 consensus EPS is projected to contract 16.1% to $9.04, as non-recurring tariff refunds roll off, highlighting that positive estimate momentum is transient and tied to one-off recoveries.1
Métricas a vigilar antes de la publicación
01
Métrica:
U.S. Retail Coffee Net Price Realization and Volume Elasticity
ActualNet price realization added 10 percentage points and volume/mix grew 2% in Q1 FY2027, lifting segment profit 124% to $300.0M.
Por qué importa
Coffee represents SJM's largest segment ($3,304.9M revenue in FY2026); sustained pricing realization without volume loss is essential to preserve gross margins against rising green coffee costs.5
Operating cash flow generation remains SJM's strongest financial attribute. The company generated $1,473.6M in operating cash flow in FY2026 against CapEx of $317.4M, producing $1,156.2M in free cash flow despite reporting a GAAP net loss of -$138.7M driven by non-cash amortization. In Q1 FY2027, operating cash flow reached $425.7M (up from -$10.6M in the prior year) and free cash flow reached $337.3M. However, cash generation is heavily front-loaded by $115.0M in tariff refunds, meaning underlying cash conversion will moderate in the second half of FY2027.4
Asignación de capital
Capital allocation is strictly directed toward debt retirement to normalize credit metrics following the Hostess acquisition. In Q1 FY2027, SJM allocated $230.8M of cash toward debt repayments against $6,940,199,936 in total debt, while maintaining its quarterly dividend of $1.12 per share ($116.8M paid). Share repurchases have been virtually halted ($5.7M in Q1 FY2027), and management has raised full-year FY2027 free cash flow to $1.1B, intended almost entirely for debt reduction with capped at $325.0M.
Trailing ROIC of 5.86% reflects heavy non-cash acquisition amortization, past goodwill impairments ($7,649.9M in FY2024 to $5,710.0M in FY2025,), and trailing GAAP net loss of -$138.7M. ROIC will steadily recover as reported operating margin normalizes toward 17.5% and cash flow retires debt ($6,940,199,936 total debt).
Trailing ROIC of 5.86% trails the weighted average cost of capital of 8.26% by 240 bps, destroying economic profit. Normalized ROIC will only exceed WACC once operating margins recover and invested capital is reduced through debt repayment.
Ingresos más recientes9050,9 M US$CAGR de ingresos +2,3 %
Margen operativo4,0 %10 periodos fiscales
Flujo de caja libre más reciente1156,2 M US$FY2026
Deuda neta6484,2 M US$FY2026
Desglose de la cuenta de resultadosCómo la escala del negocio se convierte en beneficio declarado.
Ingresos9050,9 M US$Coste de ventas−6016,4 M US$Beneficio bruto3034,5 M US$Gastos operativos−2674,3 M US$Beneficio operativo360,2 M US$Partidas no operativas e impuestos−498,9 M US$Beneficio neto-138,7 M US$
Datos del historial financiero
Ingresos
9.050.900.000 US$
Coste de ventas
6.016.400.000 US$
Beneficio bruto
3.034.500.000 US$
Gastos operativos
2.674.300.000 US$
Beneficio operativo
360.200.000 US$
Partidas no operativas e impuestos
-498.900.000 US$
Beneficio neto
-138.700.000 US$
Resumen del balanceCómo se mantienen y financian los activos declarados en el período seleccionado.
StockMarketAgent.AI
Composición de activosFinanciado por
Activos totales16,2 mil M US$Efectivo58,6 M US$Activos corrientes1973,1 M US$Pasivos totales10,7 mil M US$Pasivos corrientes2538,2 M US$Patrimonio neto5543,8 M US$
Datos del desglose del balance
Activos totales
16.219.400.000 US$
Efectivo
58.600.000 US$
Activos corrientes
1.973.100.000 US$
Pasivos totales
10.675.600.000 US$
Pasivos corrientes
2.538.200.000 US$
Patrimonio neto
5.543.800.000 US$
Puente de flujo de cajaCómo el flujo de caja operativo se convirtió en flujo de caja libre en FY2024.
StockMarketAgent.AI
Conciliación del flujo operativo
Beneficio neto744 M US$Depreciación y amortización+430,8 M US$Compensación basada en acciones+23,9 M US$Otros ajustes operativos+30,7 M US$Flujo de caja operativo1229,4 M US$
Conciliación del efectivo inicial al final
Efectivo inicial655,8 M US$Flujo de caja operativo+1229,4 M US$Flujo de inversión−3964,6 M US$Flujo de financiación+2141,6 M US$Efecto del tipo de cambio−200 mil US$Efectivo final62 M US$
1229,4 M US$ − 586,5 M US$Flujo de caja libre 642,9 M US$
Datos del puente de flujo de caja
Beneficio neto
744.000.000 US$
Entrada operativa
1.229.400.000 US$
Depreciación y amortización
430.800.000 US$
Compensación basada en acciones
23.900.000 US$
Otros ajustes operativos
30.700.000 US$
Flujo de caja operativo
1.229.400.000 US$
Efectivo disponible
4.026.800.000 US$
Efectivo inicial
655.800.000 US$
Entrada de financiación
2.141.600.000 US$
Salida de inversión
3.964.600.000 US$
Capex
586.500.000 US$
Otras actividades de inversión
3.378.100.000 US$
Efecto del tipo de cambio
200.000 US$
Efectivo final
62.000.000 US$
Flujo de inversión
-3.964.600.000 US$
Flujo de financiación
2.141.600.000 US$
Ingresos por segmento operativoProporción de los ingresos totales de 2026-04-30.
9050,9 M US$Ingresos totales
Ingresos por segmento operativoProporción
U.S.Retail Coffee3304,9 M US$36,5 %+17,8 % interanual
U.S.Retail Frozen Handheld And Spreads1853,9 M US$20,5 %−1,2 % interanual
U.S.Retail Pet Foods1600 M US$17,7 %−3,8 % interanual
Sweet Baked Snacks971,3 M US$10,7 %−17,6 % interanual
Away From Home879 M US$9,7 %+15,2 % interanual
All Other Segments441,8 M US$4,9 %+1,1 % interanual
Fuente: SEC EDGAR · Presentado 2026-06-09 · SEC EDGAR
Datos de composición de ingresos: Ingresos por segmento operativo
Ingresos por segmento operativo
Ingresos
Proporción
interanual
U.S.Retail Coffee
3304,9 M US$
36,5 %
17,8 %
U.S.Retail Frozen Handheld And Spreads
1853,9 M US$
20,5 %
-1,2 %
U.S.Retail Pet Foods
1600 M US$
17,7 %
-3,8 %
Sweet Baked Snacks
971,3 M US$
10,7 %
-17,6 %
Away From Home
879 M US$
9,7 %
15,2 %
All Other Segments
441,8 M US$
4,9 %
1,1 %
Ingresos y beneficiosCómo la escala del negocio se convierte en beneficio declarado.
Efectivo y deudaLiquidez disponible frente al endeudamiento total.
Generación de efectivoFlujo de caja operativo frente al flujo de caja libre.
RentabilidadEvolución de los márgenes bruto, operativo y neto.
Datos financieros puntuales utilizados en el análisis del 2026-10-12.
Datos del historial financiero
Período
Ingresos
EBITDA
Beneficio neto
Flujo de caja operativo
Flujo de caja libre
Capex
Depreciación y amortización
Compensación basada en acciones
Recompras de acciones
Dividendos pagados
Emisión neta de deuda
Flujo de inversión
Flujo de financiación
Efectivo inicial
Efectivo final
Efectivo e inversiones
Deuda total
Margen operativo
ROIC
WACC
Diferencial ROIC−WACC
2017-04-30
7392,3 M US$
1460,5 M US$
592,3 M US$
1059 M US$
866,6 M US$
192,4 M US$
419 M US$
22 M US$
437,6 M US$
339,3 M US$
—
-189,7 M US$
-806,1 M US$
—
166,8 M US$
208,6 M US$
4944,5 M US$
14,1 %
—
4,0 %
—
2018-04-30
7357,1 M US$
1448,2 M US$
1338,6 M US$
1218 M US$
896,1 M US$
321,9 M US$
413,1 M US$
15,4 M US$
7 M US$
350,3 M US$
—
-277,6 M US$
-922 M US$
166,8 M US$
192,6 M US$
203,5 M US$
4688 M US$
14,2 %
—
5,1 %
—
2019-04-30
7838 M US$
1355,8 M US$
514,4 M US$
1141,2 M US$
781,4 M US$
359,8 M US$
446,3 M US$
20,7 M US$
5,4 M US$
377,9 M US$
—
-1924,2 M US$
699 M US$
192,6 M US$
101,3 M US$
101,3 M US$
5484,8 M US$
11,8 %
—
4,2 %
—
2020-04-30
7801 M US$
1662,4 M US$
779,5 M US$
1254,8 M US$
985,5 M US$
269,3 M US$
446,5 M US$
26,8 M US$
4,2 M US$
396,8 M US$
—
-271,5 M US$
-688,7 M US$
101,3 M US$
391,1 M US$
391,1 M US$
5373,3 M US$
15,7 %
—
1,7 %
—
2021-04-30
8002,7 M US$
1801,5 M US$
876,3 M US$
1565 M US$
1258,3 M US$
306,7 M US$
452,5 M US$
28,7 M US$
678,4 M US$
403,2 M US$
—
311,1 M US$
-1943,9 M US$
391,1 M US$
334,3 M US$
334,3 M US$
4669,7 M US$
17,3 %
—
2,8 %
—
2022-04-30
7998,9 M US$
1463,8 M US$
631,7 M US$
1136,3 M US$
718,8 M US$
417,5 M US$
459,1 M US$
22,3 M US$
270,4 M US$
418,1 M US$
-261,8 M US$
-355,5 M US$
-944,5 M US$
334,3 M US$
169,9 M US$
169,9 M US$
4310,6 M US$
12,8 %
—
4,0 %
—
2023-04-30
8529,2 M US$
573,8 M US$
-91,3 M US$
1194,4 M US$
717 M US$
477,4 M US$
436,5 M US$
25,6 M US$
367,5 M US$
430,2 M US$
-185,9 M US$
256,2 M US$
-964,6 M US$
169,9 M US$
655,8 M US$
1143,6 M US$
4314,2 M US$
1,8 %
—
5,9 %
—
2024-04-30
8178,7 M US$
1691,5 M US$
744 M US$
1229,4 M US$
642,9 M US$
586,5 M US$
430,8 M US$
23,9 M US$
372,8 M US$
437,5 M US$
3072,2 M US$
-3964,6 M US$
2141,6 M US$
655,8 M US$
62 M US$
62 M US$
7773 M US$
16,0 %
—
5,3 %
—
2025-04-30
8726,1 M US$
-155,6 M US$
-1230,8 M US$
1210,4 M US$
816,6 M US$
393,8 M US$
502,5 M US$
29,9 M US$
3,3 M US$
455,4 M US$
-630,8 M US$
-100,3 M US$
-1102,7 M US$
62 M US$
69,9 M US$
69,9 M US$
7036,8 M US$
-7,7 %
—
—
—
2026-04-30
9050,9 M US$
875,8 M US$
-138,7 M US$
1473,6 M US$
1156,2 M US$
317,4 M US$
557 M US$
23,6 M US$
5,6 M US$
464,7 M US$
-751,5 M US$
-258,8 M US$
-1226,5 M US$
69,9 M US$
58,6 M US$
58,6 M US$
6542,8 M US$
4,0 %
—
7,5 %
—
§9 Comparación de valoración con pares
Valor razonableReport-date price
The J.M. Smucker CompanySJM
Precio / valor razonable
Valor razonable81,01 US$Report-date price120,02 US$
Fecha de evaluación
Ventaja competitivaNarrow
Cuadro de mando de inversión43 / 100
General Mills Inc.GIS
Precio / valor razonable
Valor razonable36,95 US$Report-date price32,29 US$
Fecha de evaluación
Ventaja competitivaNarrow
Cuadro de mando de inversión41 / 100
Constellation Brands Inc.STZ
Precio / valor razonable
Valor razonable181,25 US$Report-date price122,64 US$
Fecha de evaluación
Ventaja competitivaNarrow
Cuadro de mando de inversión68 / 100
The J.M. Smucker CompanySJM
Precio / valor razonable
Valor razonable81,01 US$Report-date price120,02 US$
The J.M. Smucker Company (SJM) trades at 12.0x forward earnings against a peer median of 12.3x. Its EV/EBITDA of 8.7x compares with a peer median of 9.4x. The comparison uses 4 peers: General Mills Inc., Constellation Brands Inc., Lamb Weston Holdings Inc. and McCormick & Company Incorporated, as of 2026-10-12.
§10 Industria y cicloEN
Fase del ciclo
Contraction
The North American packaged food industry is exhibiting volume fatigue following years of cumulative price hikes. Peer General Mills reported negative revenue growth of -2.8%, while industry capex-to-revenue stands at 2.3% and industry capex-to-depreciation is 1.34x, reflecting disciplined maintenance reinvestment rather than aggressive capacity expansion.
Ciclo alcista
A bull cycle in packaged foods occurs when consumer purchasing power strengthens, input costs moderate, and branded food manufacturers drive organic volume growth while preserving pricing gains and expanding premium product tiers.
Ciclo bajista
A bear cycle in packaged foods occurs when sustained agricultural commodity inflation (such as green coffee and cocoa) coincides with consumer fatigue from cumulative price increases, driving shoppers toward private label and forcing branded manufacturers to discount or sacrifice volume.
Tendencias seculares
Tendencia
Impacto
Nota
Private Label Penetration in Center-Store Groceries
negative
Persistent inflation strains household budgets, causing consumers to substitute national brands with grocery store private label peanut butter, fruit spreads, and mainstream coffee.
At-Home Coffee Rituals and Premiumization
positive
Consumers increasingly prepare premium coffee beverages at home to save money relative to specialized coffee shops, supporting demand for Dunkin', Café Bustelo, and Folgers K-Cups.
Convenience Handheld Meals and Snacking Growth
positive
Busy consumer lifestyles and hybrid work drive demand for convenient, ready-to-eat handheld meals and snacks, powering double-digit volume growth for Uncrustables sandwiches.
Health Consciousness and Scrutiny of Sweet Baked Goods
negative
Growing consumer and regulatory scrutiny of ultra-processed foods and high sugar content creates structural volume friction for traditional snack cakes and sweet baked goods.
Posicionamiento
SJM holds dominant leading market positions in North American coffee ($3,304.9M FY2026 revenue) and spreads ($1,853.9M FY2026 revenue), which provide daily pantry indispensability. However, its newly added Sweet Baked Snacks segment ($971.3M revenue) is exposed to discretionary snacking cutbacks and retailer inventory optimization.5
§11 Gestión de posiciónEN
Tamaño de posición
0%
Given our Sell rating and fair value of $81.01 against the October 12, 2026 share price of $120.02, no long equity capital commitment is warranted. Implied return is negative 32.5%. Investors should maintain zero long exposure.3
Riesgo
Risk management centers on monitoring input cost inflation and leverage covenants. Portfolio managers holding residual legacy SJM equity should maintain strict stop-loss limits at $130.00 and execute systematic liquidation. Downside short exposure should hedge against coffee commodity spikes and monitor credit rating agency communications regarding SJM's senior notes ($6,940,199,936 total debt).
The October 12, 2026 share price of $120.02 sits 48.2% above our fair value of $81.01 and substantially above Owner Earnings ($19.40) and Enterprise DCF ($77.70) midpoints, offering an asymmetric -32.5% return profile.3
Credit and Balance Sheet Perspective
Avoid
Total debt of $6,940,199,936 with a 35.12% debt weight and pre-tax cost of debt of 14.55% creates severe vulnerability if cash flow slows before significant deleveraging occurs.2,3
Operating Turnaround Perspective
Avoid
Sweet Baked Snacks volume contraction (-8% in Q1 FY2027) and private label penetration in spreads counter the transient earnings benefit from $115.0M in non-recurring tariff refunds.
§14 Recomendación finalEN
Acción
Vender
We recommend a Sell rating on The J.M. Smucker Company (SJM). At the October 12, 2026 share price of $120.02, shares trade at an unsustainable 48.2% premium to intrinsic fair value of $81.01, offering an implied return of -32.5%.3
While Q1 FY2027 results showed strong cash flow of $337.3M FCF and coffee pricing realization (+10%), earnings quality was inflated by $115.0M ($0.84 per share) in one-off tariff refunds. With total debt standing at $6,940,199,936 and Sweet Baked Snacks volume falling 8%, equity investors bear substantial operational and refinancing risk without sufficient valuation margin of safety.
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Sources
The records this analysis drew on, as they stood when it was run.
Not every cited input appears here: internal calculations and intermediate model outputs have no external record, and some citations could not be matched to one.
Refinancing friction and leverage overhang trigger credit rating downgrade, driving cost of debt and WACC up by 100 bps.
Total debt stands at $6,940,199,936 with debt weight of 35.12% and pre-tax cost of debt of 14.55%. Balance sheet leverage and debt service coverage remain pressured by the heavy debt load. If cash flow slows and debt cannot be retired, refinancing at higher rates elevates WACC from 8.26% by over 100 basis points.2,3
FV impact
-11.8%
Cost of capital 1 point higher
Trigger
Within 18 months
Persistent packaged food volume contraction and market share loss to private label de-rates terminal multiple by 20% to peer trough levels.
Peer General Mills trades at forward P/E of 10.37x and Constellation Brands trades at 10.39x. In Q1 FY2027, Sweet Baked Snacks volume fell 8% and net sales fell 7%. If organic volumes continue to decline and turnaround stalls, SJM exit multiple will derate from the modeled 12.5x to 10.0x.
FV impact
-8.1%
Terminal multiple 20% lower
Trigger
Within 24 months
02
Sweet Baked Snacks Volume Growth
Signals structural category demand destruction and consumer trade-down, threatening acquisition goodwill following past impairments ($7,649.9M in FY2024 to $5,710.0M in FY2025,).
Actual:-8.0% volume/mix decline in Q1 FY2027
Alerta siSweet Baked Snacks volume contraction worse than -5.0% for two consecutive quarters
03
Total Debt Deleveraging Pacing
Demonstrates insufficient cash generation to service debt obligations, elevating pre-tax cost of debt (14.55%) and driving WACC above 9.25%.
Actual:$6,940,199,936 as of 2026-10-12 with 35.12% debt weight
Alerta siTotal debt exceeding $6.50B or Net Debt/EBITDA remaining above 3.8x at FY2027 year-end
Discounted forecast-period cash flows (34,84 US$) plus discounted terminal value (104 US$) minus signed per current share (60,70 US$) equals the 77,70 US$ lens value shown above. Negative net debt is , so subtracting it raises value.
In the operational upside scenario, Uncrustables accelerates in sales, green coffee costs moderate, and Hostess cross-selling into away-from-home channels drives organic growth with expanding operating margins, accelerating debt reduction and multiple re-rating. Free cash flow generation exceeds full-year guidance, enabling SJM to retire substantial debt annually and de-risk credit metrics.
Métrica:
Sweet Baked Snacks Volume and Margin Stabilization
ActualNet sales fell 7% with volume/mix down 8% and segment profit down 13% to $29.9M (12.6% margin) in Q1 FY2027.
Por qué importa
Hostess Brands integration must overcome volume contraction to justify the transaction value and prevent further intangible asset impairments beyond the $1.94B goodwill write-down between FY2024 and FY2025,.4
ActualFCF was $337.3M in Q1 FY2027 funding $230.8M of debt retirement; full-year FY2027 FCF guidance raised to $1.1B.
Por qué importa
Total debt of $6,940,199,936 imposes an annual interest burden of ~$335M; aggressive debt paydown is required to lower enterprise risk and improve credit metrics.3
04
Métrica:
Uncrustables Growth Across Retail and Away From Home
ActualDrove volume gains across U.S. Retail Frozen Handheld (+1% volume/mix) and Away From Home (+2% volume/mix) in Q1 FY2027.
Por qué importa
Uncrustables represents SJM's primary high-margin organic growth platform expanding toward $1B+ in sales, supporting Frozen Handheld and Spreads ($1,853.9M in FY2026) and Away From Home ($879.0M).5
ActualQ1 FY2027 reported gross margin was 44.1% and adjusted gross margin was 42.8%, but full-year FY2027 adjusted gross margin is guided to approximately 38.75% including tariff refunds.
Por qué importa
Evaluating true operational earnings power requires filtering out the $115.0M one-time tariff refund received in Q1 FY2027.
U.S. Retail Coffee segment profit jumped 124% to $300.0M in Q1 FY2027 with a 37.1% margin, driven by 10 percentage points of price realization.
Pricing power in coffee currently cushions sweet baked snacks weakness, but volume elasticity will face scrutiny if green coffee costs remain elevated.
