A Lot of Potential Upside for Campbell Soup Company (CPB)

Campbell is the Cheapest

At the current trading price of $39.70 per share, Campbell Soup’s total market cap is $12.46 billion. The market is valuing the company at around 10.2 times EV/EBITDA. Kellogg has a more expensive valuation at 14 times EV multiple. When Warren Buffett acquired Heinz at around $72.50 per share, he valued Heinz at around 14 times EV/EBITDA. Among the three, Campbell Soup has the highest operating margin at 15.7% while Kellogg’s operating margin ranked second at around 13.9%.

Foolish Bottom Line

Among the three, Campbell seems to be the most profitable but relatively undervalued company. If Campbell has a similar valuation of 14x EV multiple, Campbell should be worth $22.4 billion on the market, or $70 per share.

The article A Lot of Potential Upside for This Food Giant originally appeared on Fool.com and is written by Anh HOANG.

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