Despite top line growth, Freshpet's EBIT loss last year and risky balance sheet, marked by high liabilities and debt, raise concerns. The company's negative free cash flow of US$163m over the past year adds to the risk profile.
Investors are likely expecting Freshpet's strong revenue performance to continue, justifying the high P/S ratio. The strong future revenue forecasts are expected to keep the share price buoyant unless the analysts have significantly missed their predictions.
Freshpet's Q4 results outperformed analysts' expectations, with impressive EPS and revenue figures. Despite negative free cash flow, the company's margin has improved over the last year. The stock is up 5.5% post-report.
Benchmark's John Lawrence rates the stock as a Buy with a $100 target, citing strong sales growth. The company's investments to create scale and extend its first-mover advantage have begun to generate improved profitability and significant operating cash flow, says CEO Billy Cyr.
Morning Movers Gapping up $ドミノ ピザ(DPZ.US)$stock rose 7% after the restaurant chain hiked its dividend and gave the green light to further share repurchases. $フレッシュペット(FRPT.US)$stock soared 12% after the pet-food manufacturer's fourth-quarter revenue and profit topped analyst estimates, helped by a rise in sales as it boosts media spending. $PPG インダストリーズ(PPG.US)$stock rose 0.5% after the paints and coatings maker sa...
The CEO of Freshpet expressed optimism for 2024, intending to continue strong margin improvement and capital discipline while sustaining net sales growth. The company believes it is well positioned to drive growth and deliver profitability.
Freshpet's strong revenue growth likely boosted its share price, making it a company worth investigating. Its recent performance, with a 44% shareholder return over the last year, suggests business momentum.
Packaged food stocks held their ground in Q3 with a 10% average share price increase. Lamb Weston and Freshpet led in revenue growth and guidance raise respectively, while Cal-Maine lagged behind.
The company's profitability hinges on a 100% annual growth rate, a highly optimistic projection. If this rate is overambitious, profitability may be delayed. The company's high debt level also amplifies investment risks.
Packaged food stocks held their ground in Q3, with shares up 9.2% on average. Freshpet and Lamb Weston beat estimates, while Cal-Maine and J. M. Smucker missed.
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Gapping up
$ドミノ ピザ(DPZ.US)$ stock rose 7% after the restaurant chain hiked its dividend and gave the green light to further share repurchases.
$フレッシュペット(FRPT.US)$ stock soared 12% after the pet-food manufacturer's fourth-quarter revenue and profit topped analyst estimates, helped by a rise in sales as it boosts media spending.
$PPG インダストリーズ(PPG.US)$ stock rose 0.5% after the paints and coatings maker sa...
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