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Accounts receivable is a big part of revenue for many companies, but it is also a potential source of problems.

Receivables represent money earned but not yet collected, so when receivables become a larger part of the revenue reported by a company, it indicates lower quality revenues. This is because there is no guarantee that the money will be paid back in full.

We ran a screen on large-cap consumer goods stocks for those that have seen positive trends in their accounts receivable, with increases in quarterly revenue year-over-year out-pacing changes in quarterly accounts receivable. We also screened for companies that have seen a decrease in accounts receivable as a percent of current assets year-over-year.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬


We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.



Do you think these companies are performing well? Use this list as a starting-off point for your own analysis.

List sorted by difference between change in revenue and accounts receivable.

1. Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR): Engages in the specialty coffee and coffee maker business. Market cap of $16.62B. MRQ revenue has increased 126.55% ($717.21M vs. $316.58M y/y) while MRQ accounts receivable has increased 78.77% ($240.16M vs. $134.34M y/y). Accounts receivable/current assets has decreased from 38.17% to 28.42%, comparing 13 weeks ending 2011-06-25 to 13 weeks ending 2010-06-26. The stock is a short squeeze candidate, with a short float at 12.51% (equivalent to 5.41 days of average volume). The stock has gained 218.01% over the last year.

2. PACCAR Inc. (NASDAQ:PCAR): Designs, manufactures, and distributes light-, medium-, and heavy-duty trucks and related aftermarket parts primarily in the United States and Europe. Market cap of $13.35B. MRQ revenue has increased 60.74% ($3,960.7M vs. $2,464.1M y/y) while MRQ accounts receivable has increased 16.86% ($7,498M vs. $6,416.1M y/y). Accounts receivable/current assets has decreased from 68.89% to 65.58%, comparing 3 months ending 2011-06-30 to 3 months ending 2010-06-30. The stock has lost 16.2% over the last year.

3. Hershey Co. (NYSE:HSY):
Engages in manufacturing, marketing, selling, and distributing various chocolate and confectionery products, pantry items, and gum and mint refreshment products worldwide. Market cap of $13.05B. MRQ revenue has increased 7.45% ($1,325.17M vs. $1,233.24M y/y) while MRQ accounts receivable has decreased 7.51% ($296.95M vs. $321.05M y/y). Accounts receivable/current assets has decreased from 22.69% to 14.91%, comparing 3 months ending 2011-07-03 to 3 months ending 2010-07-04. The stock has gained 28.22% over the last year.

4. Mead Johnson Nutrition Company (NYSE:MJN): Distributes, and sells infant formulas, children's nutritional products, and other nutritional products in Asia, Europe, Latin America, and North America. Market cap of $14.65B. MRQ revenue has increased 21.96% ($932M vs. $764.2M y/y) while MRQ accounts receivable has increased 11.55% ($369.8M vs. $331.5M y/y). Accounts receivable/current assets has decreased from 27.19% to 22.16%, comparing 3 months ending 2011-06-30 to 3 months ending 2010-06-30. The stock has gained 30.74% over the last year.

5. Philip Morris International, Inc. (NYSE:PM): Engages in the manufacture and sale of cigarettes and other tobacco products in markets outside of the United States. Market cap of $120.41B. MRQ revenue has increased 16.40% ($20,234M vs. $17,383M y/y) while MRQ accounts receivable has increased 6.53% ($3,443M vs. $3,232M y/y). Accounts receivable/current assets has decreased from 25.01% to 24.02%, comparing 3 months ending 2011-06-30 to 3 months ending 2010-06-30. The stock has gained 32.98% over the last year.

6. The Coca-Cola Company (NYSE:KO): Distributes, and markets nonalcoholic beverages worldwide. Market cap of $163.41B. MRQ revenue has increased 46.84% ($12,737M vs. $8,674M y/y) while MRQ accounts receivable has increased 40.71% ($5,630M vs. $4,001M y/y). Accounts receivable/current assets has decreased from 21.54% to 21.21%, comparing 3 months ending 2011-07-01 to 3 months ending 2010-07-02. The stock has gained 25.68% over the last year.

7. BRF - Brasil Foods S.A. (NYSE:BRFS): Produces and sells poultry, pork, beef cuts, milk, dairy products, and processed food products in Brazil and internationally. Market cap of $17.14B. MRQ revenue has increased 13.79% ($6,294.35M vs. $5,531.58M y/y) while MRQ accounts receivable has increased 8.28% ($3,227.03M vs. $2,980.13M y/y). Accounts receivable/current assets has decreased from 31.39% to 29.36%, comparing 3 months ending 2011-06-30 to 3 months ending 2010-06-30. The stock has gained 45.16% over the last year.

*Accounting data sourced from Google Finance, all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 7 Large Cap Consumer Goods Stocks With Encouraging Receivable Trends