Hawkins, Inc. (HWKN) | Investment Case

1. Company Snapshot

1.a. Company Description

Hawkins, Inc.blends, manufactures, and distributes chemicals and other specialty ingredients in the United States and internationally.It operates through three segments: Industrial, Water Treatment, and Health and Nutrition.

The Industrial segment offers industrial chemicals, products, and services to agriculture, chemical processing, electronics, energy, food, pharmaceutical, and plating industries.This segment primarily provides acids, alkalis, and food-grade and pharmaceutical salts and ingredients.It also receives, stores, and distributes various chemicals, such as liquid caustic soda, sulfuric acid, hydrochloric acid, urea, phosphoric acid, aqua ammonia, and potassium hydroxide.

In addition, this segment manufactures sodium hypochlorite and agricultural products, as well as various food-grade and pharmaceutical products that include liquid phosphates, lactates, and other blended products; repackages water treatment chemicals and bulk industrial chemicals; and performs custom blending of chemicals, and contract and private label bleach packaging.The Water Treatment segment offers chemicals, equipment, and solutions for potable water, municipal and industrial wastewater, industrial process water, and non-residential swimming pool and agriculture water.The Health and Nutrition segment offers ingredient distribution, processing, and formulation solutions to manufacturers of nutraceutical, functional food and beverage, personal care, dietary supplement and other nutritional food, and health and wellness products.

Its products portfolio includes minerals, botanicals and herbs, vitamins and amino acids, excipients, joint products, sweeteners, and enzymes.The company was founded in 1938 and is headquartered in Roseville, Minnesota.

Show Full description

1.b. Last Insights on HWKN

Hawkins, Inc.'s recent performance was driven by the acquisition of Amerochem Corporation, expanding its water treatment footprint in North Carolina. The company's Water Treatment unit benefits from added sales from acquired businesses and higher sales volumes in the legacy business. Additionally, Hawkins' consistent dividend payments since 1985 demonstrate its commitment to shareholder value. The recent appointment of Jeffery Hawkins as chief data, AI and operations officer, and Shekar Pannala as chief information officer, indicate a strategic focus on technology and operations.

1.c. Company Highlights

Last Price	137.38
Change Percentage	-0.52%
Open	138.03
Previous Close	138.1
Market Cap ( Millions)	2867
Volume	115506
Year High	186.15
Year Low	98.3
M A 50	151.04
M A 200	141.47

FCF Yield	2.75%
Dividend Yield	0.54%
ROE	17.42%
Debt / Equity	4.92%
Net Debt / EBIDTA	10.07%
Price To Book	5.62
Price Earnings Ratio	34.27
Price To FCF	36.41
Price To sales	2.74
EV / EBITDA	20.0

2. Transcript Summary

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3. NewsRoom

Hawkins, Inc. Expands in Texas with Acquisition of Redbird Chemical, Inc.

Dec -03

Source: globenewswire.com

Is the Options Market Predicting a Spike in Hawkins Stock?

Nov -25

Source: zacks.com

SYIEY or HWKN: Which Is the Better Value Stock Right Now?

Nov -24

Source: zacks.com

SYIEY vs. HWKN: Which Stock Is the Better Value Option?

Nov -07

Source: zacks.com

RBX, a founding father of West Coast Hip-Hop, Files a Class Action Lawsuit Against Spotify Concerning Alleged Streaming Fraud

Nov -04

Source: prnewswire.com

Ethic Inc. Purchases Shares of 1,424 Hawkins, Inc. $HWKN

Nov -01

Source: defenseworld.net

D.A. Davidson & CO. Cuts Holdings in Hawkins, Inc. $HWKN

Oct -30

Source: defenseworld.net

Hawkins (HWKN) Lags Q2 Earnings and Revenue Estimates

Oct -29

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.73%)

6. Segments

Industrial

Expected Growth: 4.5%

Hawkins, Inc.'s Industrial segment growth of 4.5% is driven by increasing demand for water treatment chemicals, expansion in the oil and gas industry, and strategic acquisitions. Additionally, growing concerns about environmental sustainability and regulatory compliance are boosting demand for Hawkins' specialty chemicals and services.

Water Treatment

Expected Growth: 4.8%

Hawkins, Inc.'s Water Treatment segment growth of 4.8% is driven by increasing demand for clean water, stringent environmental regulations, and aging infrastructure replacements. Additionally, the company's strategic acquisitions and expansion into new markets have contributed to its growth. Furthermore, the rising need for wastewater treatment and recycling has also boosted the segment's performance.

Health and Nutrition

Expected Growth: 5.2%

Hawkins, Inc.'s Health and Nutrition segment growth of 5.2% is driven by increasing consumer demand for healthy and organic products, rising awareness of preventative healthcare, and strategic acquisitions expanding product offerings and distribution channels.

7. Detailed Products

Industrial Adhesives

Hawkins, Inc. offers a range of industrial adhesives for bonding, sealing, and coating applications. Our adhesives are designed for use in various industries, including automotive, aerospace, and construction.

Water Treatment Chemicals

Our water treatment chemicals are designed to remove impurities and contaminants from water, making it safe for drinking, industrial use, or wastewater treatment.

Mining Chemicals

Hawkins, Inc. provides a range of mining chemicals, including flotation agents, collectors, and frothers, to improve the efficiency of mining operations.

Oil and Gas Chemicals

Our oil and gas chemicals are designed to improve the efficiency of oil and gas production, including drilling, completion, and production operations.

Food Grade Chemicals

Hawkins, Inc. offers a range of food-grade chemicals, including sanitizers, cleaners, and processing aids, for use in the food and beverage industry.

8. Hawkins, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Hawkins, Inc. is moderate due to the availability of alternative products in the market.

Bargaining Power Of Customers

The bargaining power of customers is high due to the concentration of buyers in the market, giving them significant negotiating power.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low due to the presence of multiple suppliers in the market, reducing their negotiating power.

Threat Of New Entrants

The threat of new entrants is moderate due to the moderate barriers to entry in the industry, making it possible for new companies to enter the market.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several established companies in the market, leading to intense competition.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	19.56%
Debt Cost	5.31%
Equity Weight	80.44%
Equity Cost	7.74%
WACC	7.26%
Leverage	24.32%

11. Quality Control: Hawkins, Inc. passed 9 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Oil-Dri

A-Score: 7.0/10

Value: 5.8

Growth: 9.0

Quality: 7.0

Yield: 4.0

Momentum: 10.0

Volatility: 6.0

1-Year Total Return ->

Hudson Technologies

A-Score: 5.3/10

Value: 5.3

Growth: 7.6

Quality: 6.5

Yield: 0.0

Momentum: 8.0

Volatility: 4.7

1-Year Total Return ->

Core Molding Technologies

A-Score: 5.2/10

Value: 7.2

Growth: 5.9

Quality: 5.3

Yield: 0.0

Momentum: 7.0

Volatility: 5.7

1-Year Total Return ->

Hawkins

A-Score: 5.2/10

Value: 1.6

Growth: 7.9

Quality: 5.6

Yield: 1.0

Momentum: 9.0

Volatility: 6.0

1-Year Total Return ->

Kronos Worldwide

A-Score: 5.0/10

Value: 9.1

Growth: 2.7

Quality: 5.0

Yield: 9.0

Momentum: 0.0

Volatility: 4.3

1-Year Total Return ->

NTIC

A-Score: 4.3/10

Value: 6.8

Growth: 5.8

Quality: 5.2

Yield: 3.0

Momentum: 0.5

Volatility: 4.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

11.32%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

7.26%

Hawkins, Inc. - US4202611095

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on HWKN

1.c. Company Highlights

Higher Growth

Strong Momentum

Better Quality

Earnings Miss

Revenues Beats

Expensive

Earnings Beats

Average Quality

Revenues Miss

Stable Momentum

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.73%)

6. Segments

Industrial

Expected Growth: 4.5%

Water Treatment

Expected Growth: 4.8%

Health and Nutrition

Expected Growth: 5.2%

7. Detailed Products

Industrial Adhesives

Water Treatment Chemicals

Mining Chemicals

Oil and Gas Chemicals

Food Grade Chemicals

8. Hawkins, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Hawkins, Inc. passed 9 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

137.38$

Current Price

137.38$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA