Farmer Bros Co

Farmer Bros Co has a market capitalization of $28.09 million and a price-to-book ratio of 0.65, indicating that the company is trading at a discount relative to its book value. The company's liquidity position is characterized by a current ratio of 1.42, suggesting it has sufficient short-term assets to cover its short-term liabilities. However, the company's operating cash flow is negative at -$13.15 million, and its free cash flow is -$0.71 million, indicating a lack of positive cash generation from operations.

Profitability metrics show that Farmer Bros Co is currently unprofitable, with a net loss of $0.68 million and an operating loss of $0.47 million. The company's return on equity is -1.58%, and its return on assets is -0.38%, both of which are significantly below the industry median for the Food Processing sector. The company's gross profit margin is 40.1%, which is in line with the industry median, but its operating margin is -0.55%, indicating poor operational efficiency.

The company's revenue is concentrated in a single business segment, as disclosed in its financial statements, with no material geographic diversification. This concentration increases the company's exposure to market-specific risks, particularly in the coffee and beverage processing industry. The company's revenue is primarily derived from the sale of coffee products, with no significant diversification into other food processing categories.

Farmer Bros Co's growth trajectory is uncertain, with no clear indication of revenue expansion in the near term. The company's operating income has declined, and its net income is negative. Analysts have assigned a mean price target of $1.50, which is slightly above the current market price of $1.28, but the lack of strong buy or buy recommendations suggests limited confidence in the company's near-term prospects.

The company's risk profile is characterized by a medium liquidity risk and a low dilution risk. The company has a debt-to-equity ratio of 0.55, indicating a moderate level of leverage. However, the company's net cash position is negative after subtracting total debt, which could limit its ability to fund operations or invest in growth opportunities. The company has not issued additional shares recently, and there is no indication of near-term dilution pressure.

Recent events and disclosures indicate that the company has not issued any material new products or entered into significant partnerships. The company's 10-K filing highlights ongoing challenges in the coffee market, including supply chain disruptions and rising input costs. The company has not disclosed any material legal or regulatory issues, but its financial performance suggests operational challenges that may require strategic adjustments.

Revenue grew at a 6.9% CAGR over four years, demonstrating consistent top-line expansion despite profitability challenges.

Gross profit increased to $148.9 million in 2025, indicating strong underlying pricing power and cost of goods management.

Long-term debt decreased significantly from $107.5 million in 2022 to $14.4 million in 2025, reducing financial leverage.

Analysts project 17.2% upside to a $1.50 target price, suggesting potential for near-term valuation re-rating.

Cash conversion metrics rank best-in-class within the Food Processing cohort, highlighting superior operational efficiency relative to peers.

Operating and net margins reside in the bottom quartile of the Food Processing cohort, indicating severe competitive disadvantage.

Free cash flow turned negative at -$10.5 million in 2025, reflecting an inability to generate cash from operations.

The company carries a high credit risk flag, suggesting significant concerns regarding its ability to meet financial obligations.

Return on equity remains negative at -1.58%, underperforming the 4.99% cohort median and destroying shareholder value.

Revenue $88.9M, −1,2% YoY; Operating income −506,3% YoY.

• ▍Revenue $88.9M, −1,2% YoY
• ▍Operating income −506,3% YoY
• ▍Net income −2 417,1% YoY
• ▍Free cash flow −325,4% YoY
• ▍Net margin -5.5%

Revenue $81.6M, −4,1% YoY; Operating income −12,5% YoY.

• ▍Revenue $81.6M, −4,1% YoY
• ▍Operating income −12,5% YoY
• ▍Net income +19,5% YoY
• ▍Free cash flow +42,4% YoY
• ▍Net margin -4.9%

Revenue $85.1M, +0,9% YoY; Operating income +8,1% YoY.

• ▍Revenue $85.1M, +0,9% YoY
• ▍Operating income +8,1% YoY
• ▍Net income −3,4% YoY
• ▍Free cash flow +22,8% YoY
• ▍Net margin -5.6%

Revenue $82.1M, −3,9% YoY; Operating income −661,3% YoY.

• ▍Revenue $82.1M, −3,9% YoY
• ▍Operating income −661,3% YoY
• ▍Net income −629,6% YoY
• ▍Free cash flow −408,8% YoY
• ▍Net margin -6.1%

Revenue $90.0M; Operating income $1.0M.

• ▍Revenue $90.0M
• ▍Operating income $1.0M
• ▍Net margin 0.2%

Revenue $85.1M; Operating income -$2.8M.

• ▍Revenue $85.1M
• ▍Operating income -$2.8M
• ▍Net margin -5.9%

Revenue $84.4M; Operating income -$4.1M.

• ▍Revenue $84.4M
• ▍Operating income -$4.1M
• ▍Net margin -5.4%

Revenue $85.4M; Operating income -$468.0k.

• ▍Revenue $85.4M
• ▍Operating income -$468.0k
• ▍Net margin -0.8%

Revenue $342.3M, +0,3% YoY; Operating income −308,3% YoY.

• ▍Revenue $342.3M, +0,3% YoY
• ▍Operating income −308,3% YoY
• ▍Net income −274,6% YoY
• ▍Free cash flow −186,2% YoY
• ▍Net margin -4.2%

Revenue $341.1M, +0,3% YoY; Operating income +89,3% YoY.

• ▍Revenue $341.1M, +0,3% YoY
• ▍Operating income +89,3% YoY
• ▍Net income +95,1% YoY
• ▍Free cash flow +85,1% YoY
• ▍Net margin -1.1%

Revenue $340.0M, +8,0% YoY; Operating income −250,4% YoY.

• ▍Revenue $340.0M, +8,0% YoY
• ▍Operating income −250,4% YoY
• ▍Net income −405,6% YoY
• ▍Free cash flow −388,8% YoY
• ▍Net margin -23.3%

Revenue $314.8M, +20,2% YoY; Operating income +76,8% YoY.

• ▍Revenue $314.8M, +20,2% YoY
• ▍Operating income +76,8% YoY
• ▍Net income +62,4% YoY
• ▍Free cash flow +153,4% YoY
• ▍Net margin -5.0%