BellRing Brands (BRBR) AI Stock Analysis

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BellRing Brands

(NYSE:BRBR)

64Neutral

BellRing Brands shows solid revenue growth and profitability, particularly in its Premier Protein segment. The raised guidance reflects management's confidence. However, financial risks from high leverage and negative equity, coupled with valuation concerns, moderate the overall outlook. Technical indicators suggest a cautious stance despite positive earnings momentum.

Positive Factors

Shelf-space Expansion

There is a significant opportunity for shelf-space expansion for BRBR, which could enhance its market presence.

Topline Growth

BRBR is well positioned to deliver outsized topline growth driven by its exposure to the attractive convenient nutrition category.

Negative Factors

Gross Margin Risks

There are perceptions of risks to gross margins and sales which are considered excessive.

Valuation Concerns

There is less room for valuation multiple expansion in the future.

BellRing Brands (BRBR) vs. S&P 500 (SPY)

Market Cap

$9.70B

Dividend YieldN/A

Average Volume (3M)1.49M

Price to Earnings (P/E)35.6

Beta (1Y)0.84

Revenue Growth21.00%

EPS Growth72.21%

CountryUS

Employees485

SectorConsumer Defensive

Sector Strength94

IndustryPackaged Foods

Share Statistics

EPS (TTM)2.12

Shares Outstanding128,283,140

10 Day Avg. Volume1,598,279

30 Day Avg. Volume1,488,815

Financial Highlights & Ratios

PEG Ratio0.49

Price to Book (P/B)N/A

Price to Sales (P/S)4.32

Price to Cash Flow (P/CF)755.30

P/FCF Ratio162.10

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$85.75

Price Target Upside14.01% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering12

BellRing Brands Business Overview & Revenue Model

Company DescriptionBellRing Brands, Inc. (BRBR) is a prominent consumer packaged goods company that operates within the health and wellness sector. Specializing in the development, marketing, and distribution of ready-to-drink (RTD) protein shakes, powders, and nutrition bars, the company is known for its flagship brands such as Premier Protein, Dymatize, and PowerBar. BellRing Brands is dedicated to providing convenient and nutritious products to support an active lifestyle for a broad range of consumers.

How the Company Makes MoneyBellRing Brands generates revenue primarily through the sale of its protein-centric nutritional products across various channels. The company leverages a diverse distribution network that includes retail stores, online platforms, and specialty channels to reach consumers globally. Key revenue streams include sales from ready-to-drink protein shakes, protein powders, and nutrition bars under its well-recognized brand portfolio. Significant partnerships with retailers and distributors have enhanced its market presence and accessibility to consumers. Additionally, BellRing Brands invests in marketing and innovation to maintain brand strength and meet evolving consumer preferences, further contributing to its financial performance.

BellRing Brands Financial Statement Overview

Summary

BellRing Brands demonstrates strong revenue growth and profitability, driven by effective cost management. However, high leverage and negative equity pose financial risks. The company maintains solid cash flow generation, supporting its operations and potential growth initiatives. Despite its strengths, addressing balance sheet vulnerabilities is crucial for long-term stability.

Income Statement

Very Positive

BellRing Brands shows robust revenue growth with a TTM revenue of $2.1 billion, up from $1.37 billion in 2022, indicating strong demand for its products. The company's gross profit margin of 35.96% and net profit margin of 13.31% are commendable, reflecting efficient cost management and profitability. However, the EBIT margin of 20.49% suggests room for improvement in operational efficiency.

Balance Sheet

Negative

The company's balance sheet reflects high leverage with a significant debt-to-equity ratio due to negative equity. Total debt of $833.4 million exceeds total assets, indicating financial risk. Despite this, BellRing Brands has managed to sustain operations, but negative equity remains a concern.

Cash Flow

Positive

The cash flow statement highlights a strong free cash flow of $123.8 million in TTM, showing effective cash management. The operating cash flow to net income ratio is favorable, suggesting good quality of earnings. However, the company's cash flow from financing activities indicates significant debt servicing costs.

TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Breakdown
Income Statement		Total Revenue
2.10B	2.00B	1.67B	1.37B	1.25B	988.30M
	Gross Profit
754.70M	707.30M	530.20M	421.80M	386.20M	338.00M
	EBIT
430.00M	387.70M	287.30M	212.40M	168.00M	164.00M
	EBITDA
439.20M	387.70M	315.60M	248.20M	217.60M	189.30M
	Net Income Common Stockholders
279.50M	246.50M	165.50M	116.00M	114.40M	100.10M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
49.60M	71.10M	48.40M	35.80M	152.60M	48.70M
	Total Assets
885.20M	837.00M	691.60M	707.20M	696.50M	653.50M
	Total Debt
833.40M	833.10M	856.80M	929.50M	597.50M	686.40M
	Net Debt
783.80M	762.00M	808.40M	893.70M	444.90M	637.70M
	Total Liabilities
1.03B	1.04B	1.02B	1.08B	762.00M	814.50M
	Stockholders Equity
-146.60M	-205.90M	-323.50M	-376.20M	-3.06B	-2.18B
Cash Flow		Free Cash Flow
125.50M	197.80M	213.80M	19.20M	224.50M	95.10M
	Operating Cash Flow
128.40M	199.60M	215.60M	21.00M	226.10M	97.20M
	Investing Cash Flow
-2.90M	-1.80M	-1.80M	-1.80M	-1.60M	-2.10M
	Financing Cash Flow
-160.50M	-175.10M	-201.70M	-135.00M	-120.90M	-52.60M

BellRing Brands Technical Analysis

Technical Analysis Sentiment

Positive

Last Price75.21

Price Trends

50DMA

72.86

Positive

100DMA

74.46

Positive

200DMA

66.77

Positive

Market Momentum

MACD

0.63

Negative

RSI

56.57

Neutral

STOCH

78.93

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BRBR, the sentiment is Positive. The current price of 75.21 is above the 20-day moving average (MA) of 72.91, above the 50-day MA of 72.86, and above the 200-day MA of 66.77, indicating a bullish trend. The MACD of 0.63 indicates Negative momentum. The RSI at 56.57 is Neutral, neither overbought nor oversold. The STOCH value of 78.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BRBR.

BellRing Brands Risk Analysis

BellRing Brands disclosed 47 risk factors in its most recent earnings report. BellRing Brands reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

BellRing Brands Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
POST	75 Outperform	$6.60B	19.66	10.01%	―	7.32%	34.44%
LW	72 Outperform	$7.72B	21.47	21.63%	2.65%	-2.49%	-65.96%
CAG	70 Outperform	$12.40B	38.02	3.67%	5.39%	-3.15%	-65.38%
CPB	66 Neutral	$11.37B	21.97	13.43%	3.93%	9.15%	-31.94%
BRBR	64 Neutral	$9.70B	35.63	-190.65%	―	21.00%	72.21%
Sector *	63 Neutral	$21.18B	14.33	-16.36%	3.22%	1.30%	4.55%
SJM	61 Neutral	$12.34B	22.22	-3.55%	3.71%	7.07%	-181.54%

* Consumer Defensive Sector Average

Performance Comparison

BRBR

BellRing Brands

75.21

20.00

36.23%

CPB

Campbell Soup

38.88

-2.64

-6.36%

CAG

Conagra Brands

26.19

-2.40

-8.39%

SJM

JM Smucker

117.90

12.08

11.42%

POST

Post Holdings

118.46

16.35

16.01%

Lamb Weston Holdings

55.98

-24.36

-30.32%

BellRing Brands Earnings Call Summary

Earnings Call Date: Feb 3, 2025 | % Change Since: -3.88% | Next Earnings Date: May 5, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong financial performance and growth, particularly from Premier Protein and international markets for Dymatize. However, domestic challenges for Dymatize and potential cost pressures in the second half were noted. The positive aspects of growth and raised guidance outweigh the challenges.

Highlights

Strong Financial Performance

Net sales for the first quarter were $533 million and adjusted EBITDA was $125 million, with net sales growing 24% over the prior year and adjusted EBITDA increasing 25%.

Premier Protein Growth

Premier Shake consumption growth accelerated, up 23% in the quarter, driven by distribution expansion, accelerating velocities, and incremental promotional activity.

Raised Guidance for Fiscal Year

The company raised its outlook for the year, expecting net sales to grow between 13% and 17% over fiscal '24 and adjusted EBITDA to grow between 7% and 14%.

Successful National Marketing Campaign

Premier Protein launched a national marketing campaign, with traffic to the website up 80% versus a year ago, indicating strong consumer engagement.

International Growth for Dymatize

Dymatize net sales increased 13% this quarter, primarily driven by double-digit sales growth in the international business.

Lowlights

Challenges in Dymatize Domestic Market

Despite international success, Dymatize faced domestic headwinds with pricing pressures due to elevated whey protein costs.

Potential Second Half Cost Pressures

Protein costs are expected to be more unfavorable in the second half of the fiscal year, with potential impacts on gross margins.

Company Guidance

During the BellRing Brands First Quarter Fiscal Year 2025 Earnings Conference Call, the company provided updated guidance, indicating a strong start to the fiscal year with net sales and adjusted EBITDA both growing approximately 25%, primarily driven by Premier Protein. The company raised its full-year outlook, expecting net sales growth between 13% and 17% over fiscal 2024, and adjusted EBITDA growth between 7% and 14%. The guidance reflects confidence stemming from robust Q1 performance, improved gross margins, and favorable timing of marketing expenditures. The Convenient Nutrition category, where BellRing operates, grew by 12% in Q1, with ready-to-drink products leading the category growth at 18%. Premier Protein, the company's flagship brand, experienced a 23% increase in shake consumption and maintained its status as the number one brand in the ready-to-drink segment with a 26% market share.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.