On September 19, 2023, Simply Good Foods Company (SMPL) stands out as a company in the active nutrition category, which has experienced impressive growth of 14% CAGR over the past five years. This sector benefits from various factors, including the increasing preference for snacking, convenience, and higher protein among consumers. Morgan Stanley analyst Pamela Kaufman recognizes the potential of SMPL and has upgraded the company’s shares from Equal Weight to Overweight. Additionally, Kaufman has raised the price target from $37 to $40.
Kaufman’s decision to upgrade SMPL comes after the stock’s YTD pullback of -11%, in contrast to the S&P 500’s positive growth of 16%. This presents an attractive buying opportunity for investors. The analyst has provided five compelling reasons to invest in SMPL:
1. SMPL operates in the active nutrition category, which is experiencing remarkable growth. This sector has grown at a CAGR of 14% over the past five years, driven by shifting consumer preferences towards snacking, convenience, and higher protein.
2. Within the Packaged Food category, Simply Good Foods offers an above-average growth outlook in terms of revenue.
3. Kaufman sees potential for SMPL to revitalize the Atkins brand. The company plans to increase marketing efforts, introduce innovative products in spring 2024, and has hired a new brand manager.
4. The analyst predicts an 11% CAGR in earnings per share (EPS) from 2023 to 2025. This growth is expected to be fueled by gross margin expansion due to a significant decrease in key input costs.
5. The price target of $40 is based on a valuation of 15.5 times the estimated 2024 enterprise value to earnings before interest, taxes, depreciation, and amortization (EV/EBITDA) and 23 times the estimated 2024 price-to-earnings (P/E) ratio. This reflects SMPL’s promising growth prospects and low leverage, with a net debt/EBITDA ratio of 1.0x.
As of September 19, 2023, SMPL shares are trading slightly higher, with a 0.03% increase, at $35.09.
The Simply Good Foods Company
SMPL
Buy
Updated on: 19/09/2023
Financial Health
Healthy
Debt to equity ratio: Neutral
Price to earnings ratio: Strong Buy
Price to book ratio: Strong Buy
DCF: Strong Buy
ROE: Neutral
SMPL Stock Performance on September 19, 2023: Steady Performance and Positive Forecasts
SMPL Stock Performance on September 19, 2023:
– SMPL stock opened at $35.10, slightly higher than the previous day’s closing price of $35.08.
– The stock experienced a trading range between $34.94 and $35.22.
– The trading volume for the day was 12,198, significantly lower than the average volume of 603,873 over the past three months.
– The market capitalization of SMPL stood at $3.4 billion.
Earnings Growth:
– Last year, the company’s earnings growth reached an impressive 157.47%.
– This year, the earnings growth has slowed down but remains positive at 2.10%.
– Analysts predict a steady earnings growth of 7.76% over the next five years.
Revenue Growth:
– In the previous year, the company experienced a revenue growth of 16.22%.
Valuation:
– SMPL has a price-to-earnings (P/E) ratio of 27.7.
– The price-to-sales ratio of SMPL stands at 2.71.
– The price-to-book ratio of 2.34 signifies that investors value SMPL’s assets and potential for growth.
Comparison to Other Stocks:
– While MKCVMcCormick & Company experienced a decline of 1.46%, SMPL only saw a decrease of 1.18%.
Next Reporting Date:
– SMPL’s next reporting date is on October 20, 2023.
– Analysts forecast an earnings per share (EPS) of $0.44 for this quarter.
Financial Strength and Presence:
– SMPL reported an annual revenue of $1.2 billion and an annual profit of $108.6 million.
– The company’s net profit margin was 9.29%.
– SMPL operates in the food industry and is headquartered in Denver, Colorado.
Conclusion:
– On September 19, 2023, SMPL stock demonstrated steady performance with a slight decrease in value.
– The company’s strong earnings and revenue growth, along with positive forecasts, indicate that SMPL is poised for continued success in the market.
– Investors can remain optimistic about the future prospects of SMPL stock.
Simply Good Foods Co (SMPL) Stock Shows Positive Sentiment Among Analysts and Investors
On September 19, 2023, Simply Good Foods Co (SMPL) stock had a last price of $34.96. According to data from CNN Money, 11 analysts offering 12-month price forecasts for SMPL have a median target of $42.00, with a high estimate of $49.00 and a low estimate of $40.00. This median estimate represents a 20.14% increase from the last price.
The current consensus among 12 polled investment analysts is to buy stock in Simply Good Foods Co. This rating has remained steady since September.
Simply Good Foods Co reported earnings per share of $0.44 for the current quarter and recorded sales of $321.0 million during this period.
Investors and analysts are eagerly awaiting the reporting date of October 20, when Simply Good Foods Co will release its financial results for the current quarter.
Based on the median target price from analysts and the positive consensus rating, it appears that investors are optimistic about Simply Good Foods Co’s future prospects. The projected increase in stock price suggests that the company is expected to deliver strong financial results and potentially outperform the market.
However, it is important to note that stock prices are subject to market fluctuations and can be influenced by various factors such as economic conditions, industry trends, and company-specific news. Investors should conduct their own research and consider their risk tolerance before making any investment decisions.
In conclusion, Simply Good Foods Co’s stock performance on September 19, 2023, indicates a positive sentiment among analysts and investors. The median target price suggests a potential increase in stock value, and the consensus rating to buy further supports this optimism. As the company prepares to release its financial results for the current quarter, investors will be closely monitoring the report for further insights into Simply Good Foods Co’s performance.
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