On Tuesday, Stephens reaffirmed its Equal Weight rating on shares of BellRing Brands (NYSE:BRBR) with a steady price target of $61.00 following the company's fourth-quarter fiscal year 2024 earnings release. BellRing Brands surpassed revenue expectations, posting $555.8 million against the anticipated $545.4 million by Stephens and the consensus estimate of $545.0 million.
The company's Adjusted EBITDA also came in higher at $116.5 million, compared to the projected $114.2 million by Stephens and $113.1 million consensus.
The Adjusted Earnings Per Share (EPS) for BellRing Brands was reported at $0.51, which was slightly below Stephens' estimate of $0.53 but above the consensus estimate of $0.50. The company's performance was notably driven by strong consumer demand, particularly for its Premier shakes, which have seen a resurgence in club stores.
Retailer inventories have reached healthy levels, which has contributed to improved in-store placement for the company's products.
BellRing Brands experienced growth in the ready-to-drink (RTD) shake segment, primarily through volume increases attributed to organic growth and distribution gains. The company's Premier Protein powders also experienced significant consumption growth, up 43% in the fourth quarter, achieving record household penetration.
The firm noted that BellRing Brands reported better-than-expected margins, which were supported by deflation in input costs. Additional details regarding the company's financial performance and future prospects are expected to be discussed in the earnings call. Stephens has indicated that their estimates and price target for BellRing Brands are currently under review following the earnings report.
In other recent news, BellRing Brands has been the focus of attention from analysts at Truist Securities and Citi, with both firms adjusting their price targets for the company. Truist Securities increased its target to $60 while maintaining a Hold rating, and Citi raised its target to $72, keeping a Buy rating.
These adjustments follow a period of volatility for BellRing Brands, where sales growth surpassed the company's fiscal year 2024 projections, leading to a 25% rise in stock since the third fiscal quarter earnings report.
BellRing Brands is expected to announce its fiscal year 2025 guidance during the November report of its fourth fiscal quarter 2024 results, with indications suggesting a 10-12% increase in sales growth. The company's Premier Protein brand has seen robust performance, sustaining strong growth despite nearing market maturity. However, Truist Securities expressed concerns about the brand's potential to expand into new markets and demographics.
Citi analysts maintain a Buy rating for BellRing Brands, driven by the company's sales growth outlook, expected to be at the higher end of its long-term algorithm of 10-12% by 2025. The firm also anticipates BellRing Brands to possibly exceed earnings per share expectations due to strong sales performance and a favorable cost environment.
BellRing Brands has reported significant sales growth in the third quarter of fiscal year 2024, largely driven by the Premier Protein brand. The company has also repurchased 1.3 million shares for $74 million and retains a $216 million share repurchase authorization. Looking forward to fiscal year 2025, BellRing Brands anticipates robust sales growth while expressing caution about the potential impact of inflation and increased marketing expenses.
InvestingPro Insights
BellRing Brands' (NYSE:BRBR) strong performance in Q4 2024 is reflected in its recent market metrics and analyst perspectives. According to InvestingPro data, the company's revenue growth stands at an impressive 21.58% for the last twelve months as of Q3 2024, aligning with the robust demand for Premier shakes mentioned in the earnings report. This growth is further supported by an InvestingPro Tip indicating that analysts anticipate sales growth in the current year.
The company's financial health appears solid, with an InvestingPro Tip noting that liquid assets exceed short-term obligations, suggesting a strong balance sheet position. This financial stability may contribute to BellRing's ability to capitalize on the growing demand for its products and expand distribution.
BellRing's stock performance has been particularly noteworthy, with a one-year price total return of 61.82% as of the latest data. The stock is currently trading near its 52-week high, with a price that is 99.93% of its peak. This strong market performance aligns with the company's better-than-expected earnings results and positive outlook.
For investors seeking more comprehensive analysis, InvestingPro offers 17 additional tips for BellRing Brands, providing a deeper understanding of the company's financial position and market potential.
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