Tassal Group looks the most attractive on valuations among 14 stocks in Australia's consumer staples sector tracked by at least three analysts, data from Thomson Reuters StarMine shows.
The firm has a Relative Valuation (RV) score of 94, the highest in the sector and an above-average Value-Momentum (Val-Mo) score of 75. The higher the RV score the cheaper the stock compared to its peers.
Tassal's Earnings Quality (EQ) score has increased 35 points to 63 since the company reported higher full-year revenue on Aug. 24.
The firm's net margin and free cash flow (FCF) as a percentage of sales for 2011 beat the industry average by 4 percent and 6.3 percent respectively.
Its FCF increased over 10 times to A$21 million for the year ending June 2012 from a year earlier, while its net income stayed relatively stable, falling only A$2 million to A$28 million during the same period.
Of the seven analysts tracking the stock, two give it a 'strong buy' or 'buy' rating, four have a 'hold' and one rates it a 'sell'.
The stock has risen 10.2 percent over the past 30 days, while the broader index gained 7.02 percent for the same period, as of Wednesday's close.
On the other end of the spectrum, Blackmores Ltd and Treasury Wine Estates Ltd are the most expensive stocks in the Aussie consumer staples sector with an RV score of 20 each.
Tassal's FY2012 revenue rose 16 percent year-on-year driven by growth in its domestic market. Retail market continued to be the largest driver of sales revenue and volumes for Tassal.
StarMine's Relative Valuation model combines six different ratios that measure a company's valuation and then ranks it compared with all other stocks in the same region.
StarMine's Val-Mo model provides a 1-100 percentile ranking of stocks and rates stocks based on a combination of two value and momentum metrics.
The Earnings Quality model is a percentile (1-100) ranking of stocks based on sustainability of earnings, with 100 representing the highest rank.
(Reporting By Reshma Apte)
Keywords: MIDCAP TASSAL/