The J. M. Smucker Company (SJM) Intrinsic Value & DCF Valuation
Packaged Foods · NYSE
Current Price
$126.35
Intrinsic Value
$120.94
-4.5% margin of safety
What Is The J. M. Smucker Company's Intrinsic Value?
As of 2026-07-29, the base-case DCF model estimates the intrinsic value of The J. M. Smucker Company (SJM) at $120.94 per share, compared with a market price of $126.35, a margin of safety of -4.5%. The base case assumes -0.1% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $92.9 to $153.75. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How the DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is The J. M. Smucker Company (SJM) Undervalued?
At $126.35, SJM trades about 4.5% above the base-case intrinsic value estimate, a modest premium. By this model the price sits within a normal band, though faster growth than assumed would change the picture.
COMPETITIVE MOAT
↑Strong Brand Recognition and Loyalty
Smucker possesses iconic brands like Jif, Smucker's, and Folgers, fostering deep consumer trust and repeat purchases. This brand equity translates into pricing power.
↑Extensive Distribution Network
The company benefits from established relationships with retailers and a vast distribution infrastructure. This makes it difficult for new entrants to gain shelf space and reach consumers.
↑Scale and Cost Efficiencies
Smucker's large-scale operations allow for significant cost advantages in manufacturing and procurement. This scale provides a competitive edge in a price-sensitive market.
INVESTMENT RISKS
↓Commodity Price Volatility
Fluctuations in the cost of key ingredients like coffee, peanuts, and dairy can significantly impact Smucker's profit margins. Hedging strategies are crucial but not always perfect.
↓Supply Chain Disruptions
Global supply chain issues, from raw material sourcing to transportation, can lead to production delays and increased costs. This impacts product availability and profitability.
↓Intense Competition
The packaged food industry is highly competitive, with both established players and agile startups vying for consumer attention and market share. Continuous innovation is essential.
Base case
SJM base case valuation
Intrinsic Value
$120.94
Margin of safety
-4.5%
Expected annual return
-0.9%
Base case assumptions: -0.1% annual growth, 10.0% discount rate, 12x exit multiple, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the SJM valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for The J. M. Smucker Company respond.
Open DCF Calculator for SJMCompany Overview
The J. M. Smucker Company is an international enterprise specializing in the production and marketing of a diverse portfolio of branded food and beverage items. Its operations are organized into three principal U.S. retail divisions: Pet Foods, Coffee, and Consumer Foods. The company's extensive product offerings encompass various coffee options, including roast, ground, single-serve, and premium blends; a wide selection of spreads such as peanut butter and fruit preserves; cooking staples like shortening and oils; convenient frozen sandwiches and snacks; and a full range of pet food and treats. Additionally, Smucker provides hot beverages, portion-controlled items, and flour products for the foodservice sector, alongside frozen handheld meals, juices, beverages, and baking ingredients. These items are marketed under numerous recognizable brands, including Meow Mix, 9Lives, Kibbles 'n Bits, Milk-Bone, Pup-Peroni, Rachael Ray Nutrish, Nature's Recipe, Folgers, Café Bustelo, Dunkin', 1850, Jif, Smucker's, Smucker's Uncrustables, Robin Hood, and Five Roses. The company distributes its products through a vast network, utilizing both direct sales and brokers to reach grocery stores, club stores, discount and dollar retailers, online platforms, pet specialty stores, natural food outlets and their distributors, pharmacies, military commissaries, and large mass merchandisers. Founded in 1897, The J. M. Smucker Company is headquartered in Orrville, Ohio.
Financial Metrics — SJM Stock Valuation Data
Revenue/Share (TTM)
$84.83
FCF/Share (TTM)
$10.84
ROIC (TTM)
2.5%
ROE (TTM)
-2.4%
P/FCF
11.7x
EV/EBITDA
20.0x
FCF Yield
8.56%
Debt/Equity
1.28x
Based on trailing twelve-month data, SJM shows a free cash flow per share of $10.84 and a ROIC of 2.5%, key inputs for stock valuation using the DCF method. The P/FCF ratio of 11.7x and FCF yield of 8.56% are important context metrics when evaluating SJM's stock valuation relative to peers.
Frequently Asked Questions
What is the intrinsic value of SJM?
The J. M. Smucker Company currently generates $10.84 in free cash flow per share. At the current price of $126.35, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is SJM undervalued?
SJM trades at a P/FCF ratio of 11.7x with a free cash flow yield of 8.56%. A low P/FCF means investors are paying less per dollar of free cash flow; whether that is cheap depends on the company's growth, cyclicality, and capital intensity. However, whether SJM is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value SJM stock using DCF?
To perform a DCF valuation on The J. M. Smucker Company: (1) Start with the trailing free cash flow per share ($10.84) as the base, (2) project future FCF growth over 5-10 years based on Packaged Foods industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting SJM's risk profile — with a debt-to-equity of 1.28x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to SJM?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For The J. M. Smucker Company, this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Packaged Foods trends, then discounting those amounts to today's dollars. SJM's ROIC of 2.5% means the company's return on invested capital sits below the level that typically clears its cost of capital.
How does WACC affect SJM stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For SJM, with a debt-to-equity ratio of 1.28x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 20.0x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See SJM PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Consumer Defensive valuationsDCF and P/E value SJM with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.