The J. M. Smucker Company (SJM) Stock Valuation — DCF Analysis
Packaged Foods · NYSE
Current Price
$116.49
Intrinsic Value
$128.24
+9.2% margin of safety
COMPETITIVE MOAT
↑Brand Recognition and Loyalty
Smucker commands strong consumer loyalty for its iconic brands like Smucker's, Jif, and Folgers. This deep-rooted trust allows for consistent demand and pricing power.
↑Distribution Network Strength
The company benefits from an extensive and efficient distribution network. This established infrastructure ensures broad product availability across numerous retail channels.
↑Scale and Cost Efficiencies
Smucker's large-scale operations provide significant cost advantages in procurement and manufacturing. This scale helps maintain competitive pricing and margins.
INVESTMENT RISKS
↓Commodity Price Volatility
Fluctuations in the cost of key agricultural commodities like coffee beans and peanuts can significantly impact Smucker's profitability. This makes earnings less predictable.
↓Changing Consumer Preferences
Shifting consumer tastes towards healthier or alternative products pose a threat to traditional brands. Smucker must adapt its portfolio to remain relevant.
↓Intense Competition
The packaged food industry is highly competitive, with numerous players vying for market share. This can lead to price wars and pressure on margins.
Base case
SJM base case valuation
A base case discounted cash flow model for SJM estimates an intrinsic value of about $128.24 per share, against a current price of $116.49. The model assumes 2.6% annual free cash flow growth, a 10.0% discount rate, and a 11x exit multiple.
Intrinsic Value
$128.24
Margin of safety
+9.2%
Expected annual return
+1.9%
Base case assumptions: 2.6% annual growth, 10.0% discount rate, 11x exit multiple, 5 year projection. Data as of 2026-06-12.
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
10.7x
EV/EBITDA
36.7x
FCF Yield
9.31%
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 10.7x and FCF yield of 9.31% 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 $116.49, 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 10.7x with a free cash flow yield of 9.31%. This relatively low P/FCF may suggest the stock is attractively priced relative to its cash generation. 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% suggests the company may face challenges generating returns above 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 36.7x, 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 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.