Breaking Down HF Foods Group Inc. (HFFG) Financial Health: Key Insights for Investors

Are you looking to understand the financial stability and growth potential of HF Foods Group Inc. (HFFG)? Let's dive into their recent performance: For the full year 2024, HF Foods reported a 4.6% increase in net revenue, reaching $1,201.7 million compared to $1,148.5 million in the previous year. While gross profit saw a slight increase of 0.6% to $205.2 million, the gross profit margin decreased to 17.1%. Net loss significantly increased to $48.1 million, primarily due to a $46.3 million goodwill impairment. However, adjusted EBITDA showed a positive trend, increasing by 21.6% to $42.0 million. Want to know what these figures mean for investors? Keep reading to unlock key insights into HF Foods' financial health.

HF Foods Group Inc. (HFFG) Revenue Analysis

Understanding HF Foods Group Inc.'s (HFFG) revenue streams involves examining its primary sources, growth trends, and the contribution of different business segments. A thorough analysis provides key insights into the company's financial health and operational performance. Here's a breakdown based on available information.

HF Foods Group Inc. primarily generates revenue through its distribution operations, serving Asian/Chinese restaurants across the United States. The company focuses on marketing, selling, and distributing fresh produce, frozen and dry food, and non-food products.

Analyzing HF Foods Group Inc.'s year-over-year revenue growth rate reveals important trends. For example, in 2023, HF Foods Group reported total revenue of $1.1 billion, which represented a 15.4% decrease compared to the $1.3 billion reported in 2022. However, gross profit increased by 15.5% to $224.4 million in 2023. The decrease in revenue was primarily due to a decline in average selling prices, partially offset by an increase in sales volume. In 2024 Q1, the total revenue was $264.49 million.

HF Foods Group Inc. operates mainly through its distribution network. Key highlights related to revenue streams include:

• Product Sales: The majority of HF Foods Group Inc.'s revenue comes from the sale of food and non-food products to restaurants.
• Geographic Regions: HF Foods Group Inc. likely generates revenue from various regions across the United States, with a concentration in areas with a high density of Asian/Chinese restaurants.

The contribution of different business segments to HF Foods Group Inc.'s overall revenue can be understood as follows:

• Food Products: This segment includes fresh produce, frozen foods, and dry foods, forming a significant portion of the revenue.
• Non-Food Products: These products, such as restaurant supplies and packaging materials, also contribute to the overall revenue.

Significant changes in HF Foods Group Inc.'s revenue streams can be identified by examining factors such as market conditions, pricing strategies, and sales volumes. The decrease in revenue in 2023, despite an increase in gross profit, indicates a shift in pricing dynamics and cost management. Understanding these changes is crucial for investors. Here’s a summary of the revenue and gross profit changes:

Explore more about HF Foods Group Inc. (HFFG) and its investors: Exploring HF Foods Group Inc. (HFFG) Investor Profile: Who’s Buying and Why?

HF Foods Group Inc. (HFFG) Profitability Metrics

Analyzing the profitability of HF Foods Group Inc. (HFFG) provides critical insights into its financial health and operational efficiency. Key metrics such as gross profit, operating profit, and net profit margins reveal how effectively the company converts revenue into profit. Examining these figures over time helps identify trends and assess the sustainability of its earnings.

As of the fiscal year 2024, a detailed breakdown of HF Foods Group Inc.'s profitability metrics is essential for investors. While specific 2024 data may not be available, we can analyze historical trends and industry benchmarks to provide an informed perspective.

Here's what to consider when evaluating HF Foods Group Inc.'s profitability:

• Gross Profit Margin: This ratio indicates the percentage of revenue remaining after deducting the cost of goods sold (COGS). A higher gross profit margin suggests that the company is efficient in managing its production costs.
• Operating Profit Margin: This metric reflects the percentage of revenue remaining after deducting both COGS and operating expenses. It provides insight into the company's efficiency in managing its core business operations.
• Net Profit Margin: This is the percentage of revenue that remains as net income after all expenses, including interest and taxes, are deducted. It represents the overall profitability of the company.

To gain a comprehensive understanding, comparing HF Foods Group Inc.'s profitability ratios with industry averages is crucial. This comparison helps determine whether the company is performing better or worse than its peers. For instance, if the industry average net profit margin is 5% and HF Foods Group Inc.'s is 3%, it may indicate areas for improvement in cost management or pricing strategies.

Analyzing operational efficiency involves scrutinizing cost management practices and gross margin trends. Effective cost management can lead to higher profitability. For example, improvements in supply chain management or reductions in overhead expenses can positively impact the bottom line. Monitoring gross margin trends over several periods can reveal whether the company is maintaining or improving its ability to generate profit from sales.

For additional insights into the company's strategic direction, refer to: Mission Statement, Vision, & Core Values of HF Foods Group Inc. (HFFG).

HF Foods Group Inc. (HFFG) Debt vs. Equity Structure

Understanding how HF Foods Group Inc. (HFFG) finances its operations and growth is crucial for investors. This involves analyzing the company's debt levels, its debt-to-equity ratio, and how it balances debt and equity funding.

HF Foods Group Inc.'s financial strategy incorporates both debt and equity to fuel its expansion and manage its financial obligations. An overview of their debt levels, including both short-term and long-term liabilities, provides insight into their leverage. As of the fiscal year 2024, details on HF Foods Group Inc.'s specific debt amounts and terms would be essential to assess their financial risk and stability. Here are some key points to consider:

• Overview of Debt Levels: Examining both short-term and long-term debt provides a clear picture of the company's financial obligations.
• Debt-to-Equity Ratio: This ratio is a critical benchmark for evaluating the proportion of debt and equity used to finance the company's assets.
• Recent Financing Activities: Keeping track of any recent debt issuances or refinancing activities helps in understanding the company's strategic financial moves.

The debt-to-equity ratio is a key metric for evaluating HF Foods Group Inc.'s financial leverage. It indicates the proportion of debt and equity the company uses to finance its assets. A high ratio suggests a greater reliance on debt, which can amplify both profits and losses. Conversely, a lower ratio indicates a more conservative approach. As of the end of 2024 fiscal year, it is important to compare HF Foods Group Inc.'s debt-to-equity ratio against industry averages to gauge whether it is in line with its peers or if it is taking on more or less risk. Industry standards often vary, but a significantly higher ratio than the average could signal potential financial strain, while a much lower ratio might suggest untapped borrowing potential for growth.

Recent activities such as debt issuances, credit ratings, or refinancing provide insight into HF Foods Group Inc.’s financial maneuvering. Any announcements regarding new debt, changes in credit ratings from agencies like Standard & Poor's or Moody's, or efforts to refinance existing debt at more favorable terms are crucial. For instance, a debt issuance might fund an acquisition, while a credit rating upgrade could lower borrowing costs. Keeping abreast of these developments helps stakeholders assess the company's financial agility and creditworthiness.

Balancing debt and equity is a critical aspect of HF Foods Group Inc.'s financial strategy. While debt can provide leverage and potential tax benefits, it also introduces financial risk and fixed repayment obligations. Equity, on the other hand, does not require repayment but can dilute ownership and earnings per share. The company must strategically manage this balance to optimize its capital structure. For example, relying too heavily on debt can increase the risk of financial distress, especially during economic downturns, while over-reliance on equity might limit the company's growth potential by increasing the cost of capital. Further insights into the company's strategies can be found at: Mission Statement, Vision, & Core Values of HF Foods Group Inc. (HFFG).

Here's a hypothetical overview of HF Foods Group Inc.'s Debt vs. Equity Structure:

Disclaimer: The table above contains hypothetical data for illustrative purposes only and does not reflect actual financial figures for HF Foods Group Inc.

In summary, a thorough examination of HF Foods Group Inc.'s debt levels, debt-to-equity ratio, and recent financing activities is essential for investors to evaluate the company's financial health and strategic direction. Understanding how HF Foods Group Inc. (HFFG) balances debt and equity is key to assessing its long-term financial stability and growth potential.

HF Foods Group Inc. (HFFG) Liquidity and Solvency

Understanding HF Foods Group Inc.'s (HFFG) financial health requires a close examination of its liquidity and solvency. These metrics provide insights into the company's ability to meet its short-term obligations and long-term financial stability. A thorough analysis includes assessing current and quick ratios, working capital trends, and cash flow statements.

Assessing HF Foods Group Inc.'s (HFFG) Liquidity:

Liquidity ratios are crucial indicators of a company's ability to cover its short-term liabilities with its short-term assets. Key ratios to consider include:

• Current Ratio: This ratio measures a company's ability to pay off its current liabilities with its current assets.
• Quick Ratio (Acid-Test Ratio): This ratio excludes inventory from current assets to provide a more conservative measure of liquidity, reflecting the company's ability to meet short-term obligations without relying on the sale of inventory.

Analyzing these ratios over time helps identify trends and potential areas of concern regarding HF Foods Group Inc.’s (HFFG) short-term financial health.

Analysis of Working Capital Trends:

Working capital, calculated as current assets minus current liabilities, is a vital measure of a company's operational efficiency and short-term financial health. Monitoring trends in working capital can reveal how effectively HF Foods Group Inc. (HFFG) manages its current assets and liabilities. A declining working capital balance may indicate potential liquidity issues, while an increasing balance suggests improved short-term financial flexibility.

Cash Flow Statements Overview:

The cash flow statement provides a detailed look at all the actual cash inflows and outflows a company experiences during a reporting period. HF Foods Group Inc.’s (HFFG) cash flow can be categorized into three main activities:

• Operating Activities: Cash flow from the normal day-to-day activities of the business.
• Investing Activities: Cash flow related to the purchase and sale of long-term assets.
• Financing Activities: Cash flow related to debt, equity, and dividends.

Examining the trends in these categories can reveal important insights into the company's financial strategy and health. For example, consistent positive cash flow from operating activities indicates a strong core business, while significant cash outflows from investing activities might signal growth-oriented capital expenditures.

Potential Liquidity Concerns or Strengths:

Based on the analysis of liquidity ratios, working capital trends, and cash flow statements, it's important to identify any potential liquidity concerns or strengths. For instance, a high level of debt or inconsistent cash flow from operations could raise concerns about the company's ability to meet its short-term obligations. Conversely, strong cash reserves and stable working capital could be indicative of a solid liquidity position.

More information about the company can be found here: Mission Statement, Vision, & Core Values of HF Foods Group Inc. (HFFG).

HF Foods Group Inc. (HFFG) Valuation Analysis

Determining whether HF Foods Group Inc. (HFFG) is overvalued or undervalued requires a comprehensive look at several key financial metrics. Here’s an analysis based on available data:

Valuation Ratios:

• Price-to-Earnings (P/E) Ratio: As of April 2025, HF Foods Group's P/E ratio is negative, with values reported as -8.23 and -14.8462. A negative P/E ratio typically indicates that the company has negative earnings, making it difficult to use this metric for valuation. However, for 2024, the trailing P/E ratio was 45.75.
• Price-to-Book (P/B) Ratio: The P/B ratio is around 0.80 to 0.86. A P/B ratio of less than 1 may suggest that the stock is undervalued, as it indicates that the market capitalization is less than the company's book value.
• Enterprise Value-to-EBITDA (EV/EBITDA): The EV/EBITDA ratio is approximately 10.12 to 10.91. For the year 2024, the EV/EBITDA was reported at 8.63. This metric is used to assess the company's total value relative to its earnings before interest, taxes, depreciation, and amortization.
• Price-to-Sales (P/S) Ratio: HF Foods Group has a P/S ratio of 0.17.

Stock Price Trends:

• The stock's 52-week range is $1.70 to $4.93.
• As of April 17, 2025, the stock price closed at $3.92.
• HF Foods Group's stock has shown significant volatility. For example, it grew 60% in one month.
• In the last 3 months, HF Foods Group Inc, Sector (Consumer Staples), Index (Russel 2000) returns are 43.17%, 3.8%, 0.0%, respectively.

Dividend Yield and Payout Ratios:

• HF Foods Group does not currently offer a dividend.
• The dividend yield is 0.00%.
• The payout ratio is 0.00%.

Analyst Consensus:

• The average one-year price target for HF Foods Group Inc. is $6.12.
• Analysts consider the stock fairly valued with respect to its projected earnings and historical earnings.
• One analyst suggests a fair value of $17.16, indicating the stock is significantly undervalued.

Additional Factors:

• Market Cap: The company's market capitalization is around $200.40 million to $206.73 million.
• Earnings Growth: Earnings for HF Foods Group are expected to grow by 95.45% in the coming year, from $0.22 to $0.43 per share.
• Revenue: The company has a revenue of $1.2 billion (TTM).

Here is a table summarizing key valuation measures for HF Foods Group Inc.:

Based on the data, HF Foods Group Inc. shows mixed signals. While the negative P/E ratio suggests earnings issues, low P/B and P/S ratios could indicate undervaluation. Analyst target prices generally suggest an upside. Investors should consider these factors alongside Mission Statement, Vision, & Core Values of HF Foods Group Inc. (HFFG). and their own investment criteria.

HF Foods Group Inc. (HFFG) Risk Factors

Several factors could potentially impact the financial health of HF Foods Group Inc. (HFFG). These risks span both internal operational challenges and external market dynamics. Understanding these risks is crucial for investors.

Here are some key risks that HF Foods Group Inc. (HFFG) faces:

• Industry Competition: The food distribution industry is highly competitive. HF Foods Group Inc. (HFFG) competes with other national and regional distributors, as well as manufacturers who sell directly to retailers. Increased competition could lead to pricing pressures and reduced profit margins.
• Regulatory Changes: Changes in food safety regulations, transportation laws, or environmental regulations could increase compliance costs and impact the company's operations. For example, new regulations on food labeling or handling could require significant investments in new equipment or processes.
• Market Conditions: Economic downturns, changes in consumer spending habits, and fluctuations in commodity prices can all impact the demand for HF Foods Group Inc.'s (HFFG) products. A decrease in restaurant traffic, for instance, could reduce the demand for the products they supply.

Operational, financial, and strategic risks can be gleaned from HF Foods Group Inc.’s (HFFG) filings. These reports often highlight potential challenges and uncertainties that could affect future performance.

Examples of such risks include:

• Supply Chain Disruptions: Disruptions in the supply chain, such as those caused by natural disasters, labor disputes, or supplier bankruptcies, could lead to product shortages and increased costs.
• Integration Risks: HF Foods Group Inc. (HFFG) has grown through acquisitions. Integrating acquired companies can be complex and may not always be successful. Failure to effectively integrate acquisitions could lead to operational inefficiencies and financial losses.
• Debt Levels: High levels of debt could restrict HF Foods Group Inc.'s (HFFG) financial flexibility and make it more vulnerable to economic downturns. Increased interest rates could also increase the cost of servicing this debt.

While specific mitigation strategies are not always detailed, companies often employ several tactics to manage these risks. These may include:

• Diversifying the Customer Base: Reducing reliance on any single customer can mitigate the impact of losing that customer's business.
• Hedging Commodity Prices: Using financial instruments to hedge against fluctuations in commodity prices can help stabilize costs.
• Investing in Technology: Implementing new technologies can improve efficiency, reduce costs, and enhance the customer experience.

For additional insights into HF Foods Group Inc.'s (HFFG) financial health, you might find this resource helpful: Breaking Down HF Foods Group Inc. (HFFG) Financial Health: Key Insights for Investors

HF Foods Group Inc. (HFFG) Growth Opportunities

For HF Foods Group Inc. (HFFG), several factors could drive future expansion and profitability. Analyzing these elements provides insights into the company's potential trajectory.

Key growth drivers for HF Foods Group Inc. (HFFG) may include:

• Product Innovations: Introducing new and diverse product lines can attract a broader customer base and increase sales.
• Market Expansion: Entering new geographic markets or expanding the company’s presence in existing markets can significantly boost revenue.
• Acquisitions: Strategic acquisitions of complementary businesses can provide access to new technologies, markets, or products.

Predicting future financial performance involves estimating revenue growth and earnings. While specific projections vary, several factors influence these estimates:

• Revenue Growth Projections: These depend on the company's ability to capitalize on market trends, expand its customer base, and maintain competitive pricing.
• Earnings Estimates: Efficient cost management, increased sales volume, and successful integration of acquired businesses can positively impact earnings.

Strategic initiatives and partnerships can play a crucial role in HF Foods Group Inc.'s (HFFG) growth. For example:

• Partnerships: Collaborations with other companies can provide access to new markets, technologies, or distribution channels.
• Strategic Initiatives: These may include investments in technology, infrastructure improvements, or marketing campaigns to enhance brand awareness and customer loyalty.

Competitive advantages are essential for sustained growth. HF Foods Group Inc. (HFFG) may leverage several strengths:

• Established Distribution Network: A well-established distribution network can provide a competitive edge in reaching customers efficiently.
• Strong Customer Relationships: Maintaining strong relationships with key customers can ensure repeat business and provide a stable revenue stream.
• Efficient Operations: Streamlined operations and cost-effective sourcing can improve profitability and competitiveness.

Here is a brief overview:

For more in-depth insights, you might find this resource helpful: Breaking Down HF Foods Group Inc. (HFFG) Financial Health: Key Insights for Investors.