Breaking Down Coffee Holding Co., Inc. (JVA) Financial Health: Key Insights for Investors

You're looking at Coffee Holding Co., Inc. (JVA) and seeing a classic growth-vs-risk scenario that needs a clear-eyed review. Honestly, the headline numbers for the 2025 fiscal year are a mixed bag, which is why the stock closed recently at $3.49 a share, well below the $4.50 analyst target. The good news is the core business is strong: Q3 2025 net sales hit $23.9 million, a massive 27% jump over the prior year, pushing the trailing twelve months (TTM) revenue to $89.75 million. But here's the rub: that same quarter saw a net loss of $1.19 million, almost entirely due to a $2.2 million negative hit from derivative positions (hedging instruments) as coffee prices fell, which is a major, defintely manageable, near-term risk. We need to look past the paper losses from commodity volatility and assess if the underlying operational momentum-plus the profit contribution from the new Second Empire acquisition-is enough to justify the upside, so let's break down the true financial health.

Revenue Analysis

You're looking for a clear picture of where Coffee Holding Co., Inc. (JVA) makes its money, and the Q3 2025 results give us a strong, albeit slightly complex, answer. The direct takeaway is that JVA is seeing solid top-line expansion, driven primarily by its packaged coffee business, but you need to watch the underlying commodity risk. The company's trailing twelve months (TTM) revenue, ending July 31, 2025, hit $89.75 million, representing a 17.92% increase year-over-year.

This is defintely a good sign, especially when you compare it to the $78.56 million in annual revenue for the full fiscal year 2024, which itself was a 15.24% jump from the prior year. The near-term growth is accelerating. For the most recent quarter, Q3 2025, net sales rose to $23.9 million, a significant 27% increase compared to the $18.8 million in the same period last year. That's a strong quarter.

Here's the quick math on their primary revenue streams, which break down into two main segments: selling finished products (packaged coffee) and selling the raw material (green coffee beans). JVA's revenue model is diversified, which helps mitigate risk in volatile coffee markets.

• Packaged Coffee: Proprietary brands and private label roasting/blending for retailers.
• Green Coffee: Importing and reselling raw beans to smaller regional roasters.

The packaged coffee segment is the clear leader. Looking at the Q2 2025 figures, the $23.32 million in total revenue was split as follows:

The shift in revenue streams is subtle but important: the recent acquisition of Empire Coffee Company is showing positive results, contributing to the packaged segment's strength, and the company has been able to implement price increases to offset rising commodity costs. The risk, though, is that the company took a $2.2 million negative hit from derivative positions (futures contracts) in Q3 2025, which caused a net loss despite the strong sales growth. This shows how tightly their profitability is tied to managing commodity price fluctuations. You need to read more on the company's financial health, which you can do by checking out Breaking Down Coffee Holding Co., Inc. (JVA) Financial Health: Key Insights for Investors.

So, the action item here is clear: Monitor the gross margin (which was 19% in Q2 2025) in the next report to see if the price increases are sticking and if the derivative losses are reversing, as management expects.

Profitability Metrics

You're looking for a clear picture of how Coffee Holding Co., Inc. (JVA) converts sales into profit, and honestly, the recent numbers show a company navigating a volatile commodity market with mixed success. The Trailing Twelve Months (TTM) data ending July 31, 2025, gives us the most current view, showing a significant gap between their margins and the broader industry.

For the TTM period, Coffee Holding Co., Inc. reported total revenue of nearly $89.75 million. Here's the quick math on their core profitability:

• Gross Profit Margin: 20.29%
• Operating Profit Margin: 3.43%
• Net Profit Margin: 2.07%

The gross margin is decent for a wholesale roaster, but the operating and net margins tell a story of high operational costs and non-core financial pressures. The industry average profit margin for US coffee production in 2025 is estimated to be around 11.0%, so JVA's 2.07% net margin is defintely lagging behind the peer group. They are simply not dropping enough of their gross profit to the bottom line.

Margin Trends and Operational Efficiency

The trend in profitability is volatile, which is typical for a company exposed to commodity price swings. The Gross Profit Margin was a healthy 20% for the full fiscal year 2024, but the quarterly results for 2025 show a sharp deterioration, highlighting operational risks.

The second quarter of 2025 (Q2 2025) was solid, with the company maintaining a 19% Gross Margin while successfully reducing selling expenses. That's a sign of good cost management in a challenging environment. But then, the third quarter (Q3 2025) saw a startling drop, with the quarterly Gross Profit Margin sinking to -1.80%.

What this estimate hides is the impact of non-operational items. The company reported a net loss of $1.19 million in Q3 2025, primarily due to a substantial $2.2 million loss from derivative positions (financial instruments used to hedge against price changes). This single event wiped out the operating profit for the quarter and then some. This is a crucial data point for investors, suggesting that while the core business is resilient-they held ground on pricing-their risk management on the commodity side needs a closer look. You should read more about the shareholder base in Exploring Coffee Holding Co., Inc. (JVA) Investor Profile: Who's Buying and Why?.

Here is a snapshot of the TTM margins compared to the industry benchmark:

The comparison is stark. Coffee Holding Co., Inc.'s margins are significantly lower across the board, which is often the case for smaller, vertically integrated wholesale players compared to the larger, more diversified consumer staples companies that make up the broader industry average. Your action item here is to monitor their hedging strategy and the contribution from the Second Empire acquisition, which is already starting to contribute to profits.

Debt vs. Equity Structure

You're looking at Coffee Holding Co., Inc. (JVA) because you want to know how they fund their operations-is it mostly shareholder money (equity) or borrowed money (debt)? The direct takeaway is that Coffee Holding Co., Inc. is a low-leverage company, relying significantly more on equity than debt, especially long-term debt, which is a sign of financial conservatism.

As of the third quarter of fiscal year 2025 (July 2025), their debt-to-equity (D/E) ratio stood at a very healthy 0.34. Here's the quick math on why that's strong: for every dollar of shareholder equity, the company uses only about 34 cents of debt. Compare that to the packaged foods and meats industry average, which often sits around 0.71 to 0.84. Coffee Holding Co., Inc. is defintely running a tighter ship on leverage than many of its peers.

The company's total debt is manageable, but it's almost entirely short-term. Total Liabilities for Q3 2025 were $19.11 million, which, when subtracted from Total Assets of $45.88 million, leaves a Total Equity of approximately $26.77 million. The debt itself is structured as follows:

• Long-Term Debt: $0.00 million (as of July 2025).
• Short-Term Debt/Borrowings: Approximately $7.05 million (as of July 2025).

The fact that their long-term debt is effectively zero is a huge plus for stability, but you still need to watch the short-term borrowings. This short-term debt primarily relates to their $10.0 million revolving credit facility, which they use to manage working capital, especially to buy and hold inventory. In Q3 2025, borrowings under this facility increased to $6.25 million as they proactively built inventory ahead of potential tariff changes.

Their financing strategy is clear: they use equity and internally generated cash flow for growth, and a flexible credit line for commodity-driven working capital needs. This approach minimizes interest rate risk and the rigid repayment schedules of long-term bonds. To be fair, the company is not publicly rated by major credit agencies like S&P or Moody's, which is common for smaller-cap stocks, but their balance sheet speaks for itself. They are actively paying down obligations, too, with Payments of Debt totaling $-3.70 million over the TTM ended July 2025.

This conservative capital structure gives them a lot of flexibility, which is crucial in a volatile commodity business like coffee. If you want to dive deeper into the full picture, you can find more analysis on this link: Breaking Down Coffee Holding Co., Inc. (JVA) Financial Health: Key Insights for Investors.

Liquidity and Solvency

You need to know if Coffee Holding Co., Inc. (JVA) can cover its near-term bills, especially with commodity price volatility. The short answer is yes, but with a caveat: its liquidity is heavily tied up in inventory, which is typical for a coffee company, but still a risk. Their most recent current ratio is strong, but the quick ratio tells a more cautious story.

As of the most recent quarter, Coffee Holding Co., Inc.'s liquidity position, measured by the current ratio (current assets divided by current liabilities), stood at a healthy 2.23. This means the company has $2.23 in current assets for every dollar of current liabilities, which is defintely a solid buffer. But when you strip out inventory-which is less liquid and subject to commodity price swings-the quick ratio (or acid-test ratio) drops significantly to 0.65. This is the key insight: they cannot cover all short-term debt with just cash and receivables; they have to sell their coffee stock.

• Current Ratio (MRQ): 2.23 (Strong short-term solvency)
• Quick Ratio (MRQ): 0.65 (Indicates high reliance on inventory to meet immediate obligations)
• Working Capital (Q3 2025): $20,979,529

Working Capital and Cash Flow Trends

The company's working capital-the difference between current assets and current liabilities-has seen a slight contraction through the 2025 fiscal year. It decreased from $22,386,733 at the end of Q1 2025 to $20,979,529 by the end of Q3 2025. This decline is attributed to higher accounts payable and, importantly, increased borrowings under their line of credit. Here's the quick math: a drop of over $1.4 million in working capital in six months means less buffer for unexpected costs, even with a strong current ratio. You can read more about the company's strategic direction here: Mission Statement, Vision, & Core Values of Coffee Holding Co., Inc. (JVA).

The cash flow statement overview for the trailing twelve months (TTM) ending in 2025 highlights the operational challenges. Cash Flow from Operating Activities (CFO) was negative at approximately -$5.17 million. This is the most critical metric; a negative CFO means the core business is using cash, not generating it. This is not sustainable without external financing.

Here is a breakdown of the cash flow trends based on TTM and Q1 2025 data:

Liquidity Concerns and Actionable Strengths

The main liquidity concern is the negative operating cash flow combined with the low quick ratio. The company is funding its operations and growth (like the Second Empire acquisition) by drawing on its credit facility, which provided $2,200,000 in Q1 2025 financing. This is a common strategy for growth, but it increases debt. The outstanding balance on their line of credit was $2,200,000 as of January 31, 2025.

Still, their strengths are clear. The total assets as of July 31, 2025, were $45.87 million, providing a solid asset base. Plus, the Q3 2025 net sales increased by 27% to $23.9 million, showing strong demand. The key action for management now is converting that sales growth into positive operating cash flow, otherwise, the reliance on the credit facility will become a solvency issue, not just a liquidity one.

Valuation Analysis

You want to know if Coffee Holding Co., Inc. (JVA) is a buy, and the valuation metrics give a mixed signal, which is typical for a micro-cap stock with volatile earnings. The short answer is that the stock looks cheap on a book value basis but is trading at a premium to its recent historical P/E, suggesting the market is anticipating a significant earnings rebound.

As of November 2025, the picture for Coffee Holding Co., Inc. is one of deep value in certain areas, but also one of high volatility. The key question is whether the recent earnings volatility is a temporary blip or a systemic issue. You need to look at the core ratios to see the disconnect.

• Price-to-Book (P/B): At a P/B ratio of just 0.83 as of November 2025, the stock is trading below its net tangible assets. This is a classic deep value indicator, suggesting the market values the company at less than the liquidation value of its assets.

• Price-to-Earnings (P/E): The P/E ratio sits at approximately 10.91 as of November 23, 2025. For context, the broader packaged foods industry often trades higher. But honestly, JVA's P/E has been all over the map, making a direct comparison tricky. It's a low multiple, but only if the 'E' (Earnings) is sustainable.

• Enterprise Value-to-EBITDA (EV/EBITDA): The latest twelve months (LTM) EV/EBITDA is around 8.1x. This multiple is generally considered reasonable, even slightly low, compared to peers in the Consumer Staples sector. What this estimate hides is the company's recent earnings volatility, which can make the EBITDA figure less reliable for forward-looking valuation.

The stock is defintely cheap on a Price-to-Book basis, but the market is clearly discounting its earnings power, which is why the P/E is low. You're essentially buying assets at a discount, but betting on a profit recovery.

Stock Price and Trend Analysis

The stock price trend over the last couple of years has been a wild ride, which shows the high-risk nature of the stock. Here's the quick math on recent performance: the stock price fell by a huge -56.67% in 2023, then rocketed up by 280.00% in 2024, only to dip by 0.69% in 2025. This isn't a steady-Eddie stock; it's a trader's playground.

The stock price as of November 21, 2025, was $3.49. That's near the bottom of its 52-week range of $2.75 to $9.93. The massive price swings mean you need to be ready for volatility. If you believe in the long-term Mission Statement, Vision, & Core Values of Coffee Holding Co., Inc. (JVA), the current price is a low entry point, but the momentum is currently against it.

Here is a snapshot of the key valuation metrics as of November 2025:

Dividend Policy and Analyst Consensus

You shouldn't buy Coffee Holding Co., Inc. (JVA) for income. The TTM Dividend Yield as of November 2025 is 0.00%. The company has not paid a regular dividend since early 2022, and the Dividend Payout Ratio for the quarter ended July 2025 was 0.00. They are prioritizing capital preservation or reinvestment over shareholder payouts right now, which is a key signal for a smaller company.

Analyst coverage is thin, which is another risk factor. There is no broad consensus 'Buy, Hold, or Sell' rating. However, technical analysis signals as of November 2025 lean heavily toward a 'Sell' or 'Strong Sell' candidate, indicating a negative short-term outlook. This bearish sentiment is a near-term risk you need to factor in, especially since the stock is in a downtrend. So, if you're looking for a quick turnaround, the technical picture says wait.

Next Step: Before making a move, Finance should model a scenario where JVA's P/E normalizes to a conservative 15x, using your own normalized earnings estimate, to see if the upside justifies the current high-volatility risk.

Risk Factors

You're looking at Coffee Holding Co., Inc. (JVA) and seeing strong revenue growth, but let's be real: this is a commodity business, and volatility is the biggest headwind. The company's financial health is currently a tug-of-war between strong sales and external market forces they can't fully control. We need to map out the near-term risks to understand where the stock price might get squeezed.

The core of the risk profile lies in three areas: market price swings, financial exposure from hedging, and the execution of their strategic consolidation plan. Honestly, the Q3 2025 report shows just how quickly market risk can hit the income statement.

Market and External Risks: The Commodity Price Rollercoaster

The most immediate and significant risk for Coffee Holding Co., Inc. is the extreme volatility of green coffee prices. While a rising market generally helps, a sharp drop can be brutal, as seen in the third fiscal quarter of 2025 (ending July 31, 2025). The company's use of derivative instruments, which are essentially financial contracts to hedge (protect) against price changes, led to a substantial loss when prices fell sharply. This is a necessary evil in the coffee business, but it creates financial risk.

Plus, there's the looming threat of new tariffs on Brazil imports. Coffee Holding Co., Inc. was smart, increasing its inventory by over 25% ahead of the August 1, 2025, tariff implementation. But this is a temporary fix. Once that cheaper, pre-tariff inventory runs down, they will either have to absorb the tariff cost or pass it on, which risks losing market share to competitors who might be better positioned. That's a defintely tricky spot.

Financial and Operational Risks from Recent Filings

The financial impact of market swings was clear in the Q3 2025 results. Despite robust sales growth, the company swung to a net loss. You need to look past the top-line revenue number to see the underlying financial strain. Here's the quick math on the Q3 2025 hit:

This inventory buildup, while strategic, pushed borrowings up significantly under their credit facility and cut cash and cash equivalents from $1.8 million to $1.0 million sequentially. That's a major cash flow constraint. They also had a specific operational risk in Q2 2025, losing money on their largest wholesale customer due to a prior contractual obligation tied to lower market pricing. That kind of legacy contract risk is a clear drag on margins.

Mitigation Strategies and Clear Actions

The company is not just sitting still; they are taking concrete actions to manage these risks. Their strategy centers on financial flexibility, operational efficiency, and a measured approach to pricing. This is how they plan to navigate the next few quarters:

• Pricing Power: Maintained pricing in Q3 2025, but future price increases are expected to offset diminishing tariff-free inventory.
• Operational Consolidation: Announced the closure of the Comfort Foods facility in North Andover, MA, in October 2025, consolidating production into the more efficient Second Empire facility in Port Chester, NY. This should cut costs.
• Strategic Acquisition Payoff: The Second Empire acquisition is now showing early profits and is expected to be accretive (adding) to future earnings.
• Financial Buffer: Filed a shelf registration statement with the SEC, which gives them the option to raise capital quickly if needed, providing a crucial financial safety net.

The management is a trend-aware realist, using inventory to combat tariffs and consolidation to boost margins. If you want to dive deeper into who is betting on these strategies, you should read Exploring Coffee Holding Co., Inc. (JVA) Investor Profile: Who's Buying and Why?

Growth Opportunities

You want to know where the next dollar of growth comes from for Coffee Holding Co., Inc. (JVA). The short answer is strategic acquisitions and disciplined pricing, which are setting the stage for a strong finish to the 2025 fiscal year. The company is defintely poised to capitalize on market volatility where competitors struggle.

The core of their near-term growth is a smart, counter-cyclical inventory strategy and the successful integration of a key acquisition. This approach is designed to translate fluctuating commodity prices into a competitive advantage and accretive (profit-adding) earnings.

Growth Drivers: Acquisitions and Brand Strength

The most concrete growth driver in 2025 is the acquisition of Second Empire, formerly Empire Coffee Company. This is a clear case of strategic expansion. The acquisition recorded a profit in July 2025, just months after the deal closed, and is now expected to be accretive to future earnings. This means the purchase is adding to the company's earnings per share, not diluting it.

Beyond M&A (mergers and acquisitions), the company's proprietary brands are performing well. For example, their flagship Café Caribe brand, which targets the highly competitive Latin espresso market, saw sales grow 9% in the first fiscal quarter of 2025, demonstrating an ability to gain market share.

• Acquisition of Second Empire is already profitable.
• Café Caribe brand sales grew 9% in Q1 2025.
• Strategic inventory build ahead of new tariffs.

Near-Term Revenue and Earnings Estimates

Despite a Q3 2025 net loss of $1.19 million due to a $2.2 million negative impact from derivative positions (an unrealized paper loss tied to falling coffee prices), the underlying operational performance is strong. Net sales actually increased 27% to $23.9 million for the fiscal quarter ending July 31, 2025, compared to the same period in 2024. That's a huge jump in top-line revenue.

Here's the quick math: Management is confident that the reversal of those derivative losses, combined with selling inventory purchased at favorable prices, will lead to a stellar Q4. Analysts estimate a full FY2025 net income approaching $0.60 per share. This is a massive turnaround from the Q3 loss, and it's why market volatility isn't always a bad thing for a well-hedged player.

The company's trailing twelve months net profit ending July 31, 2025, was already $1.85 million, a 64.91% increase year-over-year, showing the positive trend before the Q3 derivative hiccup.

Competitive Advantages and Clear Actions

Coffee Holding Co., Inc. (JVA) has a key competitive advantage in its positioning as an integrated wholesale coffee roaster and dealer that offers a broad array of products, from specialty green coffee to eight proprietary brands and private label services. This horizontal integration helps them manage margin compression across different segments of the market.

Their strategic move to increase inventory before new tariffs on Brazil imports took effect on August 1st, 2025, was a calculated risk that is expected to pay off in Q4. This allowed them to maintain a stable pricing strategy while competitors were forced into price concessions that they now have to reverse as coffee prices rise. This pricing discipline is a major advantage. To dive deeper into the market perception of these moves, you should read Exploring Coffee Holding Co., Inc. (JVA) Investor Profile: Who's Buying and Why?

The company's strong balance sheet and hedging strategies also position it to capture new business from competitors who may face financial distress due to the volatile commodity environment. They are playing offense while others are playing defense. A strong Q4 is expected to support an annual dividend of $0.20 per share for shareholders.