Company Performance - Freshpet closed at $128.17, reflecting a -1.35% change from the previous day, underperforming the S&P 500's 0.27% gain [1] - The company is projected to report earnings of -$0.05 per share, indicating year-over-year growth of 85.71%, with revenue expected at $230.47 million, a 25.71% increase from the same quarter last year [2] - Over the past month, Freshpet shares gained 5.63%, while the Consumer Staples sector declined by 2.77% [7] Analyst Estimates and Rankings - The Zacks Consensus Estimates suggest earnings of $0.54 per share and revenue of $957.37 million for the full year, representing changes of +177.14% and +24.84% from last year [8] - Freshpet currently holds a Zacks Rank of 1 (Strong Buy), with the consensus EPS estimate rising by 84.41% over the past month [4][8] - Recent revisions to analyst forecasts are seen as positive indicators for the company's business outlook [3] Industry Context - Freshpet operates within the Food - Miscellaneous industry, which ranks in the top 24% of all industries according to the Zacks Industry Rank [5] - The industry has a Zacks Industry Rank of 60, indicating a strong performance relative to other sectors [5] - Freshpet's Forward P/E ratio is 241.29, significantly higher than the industry's average Forward P/E of 17.08, suggesting a premium valuation [10]

Core Viewpoint - Freshpet's strong Q1 earnings report has driven its stock price up significantly, indicating a potential recovery in the pet food industry after a prolonged slump [2][3]. Company Performance - Freshpet's revenue for Q1 increased by 33.6% to $223.8 million, surpassing estimates of $216.4 million [3]. - The company's gross margin improved from 30.3% to 39.4%, attributed to lower input, quality, and logistics costs [3]. - Adjusted EBITDA rose dramatically from $3 million to $30.6 million, and the company turned a GAAP per-share loss of $0.52 into a profit of $0.37, exceeding the consensus estimate of a loss of $0.23 per share [3]. Market Reaction - Following the earnings report, Freshpet's stock rose 24% in May, reflecting positive investor sentiment and a broader rally in pet stocks [2][4]. - Analysts on Wall Street provided favorable commentary, contributing to the stock's upward momentum, alongside gains from competitors like Petco and Chewy [4]. Future Outlook - Freshpet reaffirmed its revenue guidance of at least $950 million, indicating a minimum growth of 24%, and raised its adjusted EBITDA expectations from $100 million to at least $120 million [5]. - The company's current price-to-sales ratio is around 7, and it trades at approximately 50 times EBITDA, which is considered reasonable given its growth rate [5].

About Freshpet SECAUCUS, N.J., May 29, 2024 (GLOBE NEWSWIRE) -- Freshpet, Inc. ("Freshpet" or the "Company") (Nasdaq: FRPT) today announced that members of the executive management team will participate in the Deutsche Bank Global Consumer Conference in Paris, France. The presentation will be on Wednesday, June 5, 2024 at 12:00 p.m. CEST / 6:00 a.m. EDT. A live webcast and replay will be available on the "Investors" section of the Company's website at www.freshpet.com. http://instagram.com/Freshpet Our food ...

Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades. While many investors like to look for momen ...

IDEXX Laboratories (NASDAQ:IDXX) is an American-based company that sells products in over 175 countries across three divisions. The modern pet industry is a testament to the amounts that pet owners and animal lovers are willing to spend on their furry companions. In 2023, U.S. consumers alone spent $147 billion in the pet industry. That's a whopping 60% more than just five years prior in 2018. Though investors might initially overlook the pet and animal industry, certain pet stocks to buy just make sense. C ...

Group 1 - Freshpet, Inc. will participate in the Deutsche Bank Global Consumer Conference in Paris on June 4, 2024 [1] - The presentation will be available via live webcast and replay on the company's website [1] Group 2 - Freshpet's mission is to enhance the lives of dogs and cats through fresh, real food made from locally sourced ingredients [2] - The company prepares its foods in small batches at lower temperatures to maintain the natural goodness of the ingredients [2] - Freshpet foods are kept refrigerated from production until they reach local markets [2] Group 3 - Freshpet products are available in various retail formats across the United States, Canada, and Europe [3] - The company emphasizes integrity, transparency, and social responsibility in its operations [3]

Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.While many investors like to look for moment ...

Key PointsFreshpet continues to build momentum and is on track for sustained profitability. Analysts are raising their targets and leading the market higher. The price action has entered a complete reversal and may gain 50% in the next 12 to 18 months. 5 stocks we like better than FreshpetFreshpet’s NASDAQ: FRPT Q1 results led the market to a 10% gain, and more fresh highs are coming. The primary takeaway is that volume gains underpin growth and provide significant leverage for this business. Headwinds rema ...

[Part I. Financial Information](index=5&type=section&id=Part%20I.%20Financial%20Information) [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) The unaudited Q1 2024 financial statements reflect a significant turnaround with net income of $18.6 million, driven by a 33.6% increase in net sales to $223.8 million and positive operating cash flow [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2024, total assets increased to $1.48 billion, total liabilities slightly decreased to $502.7 million, and stockholders' equity grew to $977.8 million Balance Sheet Items | Balance Sheet Items | March 31, 2024 (in thousands) | December 31, 2023 (in thousands) | | :--- | :--- | :--- | | **Total Assets** | **$1,480,590** | **$1,464,421** | | Total Current Assets | $406,958 | $427,319 | | Property, plant and equipment, net | $1,005,759 | $979,164 | | **Total Liabilities** | **$502,746** | **$510,967** | | Total Current Liabilities | $81,946 | $89,222 | | Convertible senior notes | $393,588 | $393,074 | | **Total Stockholders' Equity** | **$977,844** | **$953,454** | [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Loss)) Q1 2024 operations show a significant turnaround to net income of $18.6 million from a prior-year loss, driven by a 33.6% increase in net sales to $223.8 million and improved gross profit Metric | Metric | Q1 2024 (in thousands) | Q1 2023 (in thousands) | Change | | :--- | :--- | :--- | :--- | | Net Sales | $223,849 | $167,522 | +33.6% | | Gross Profit | $88,158 | $50,760 | +73.7% | | Income (Loss) from Operations | $8,463 | $(21,511) | Turnaround | | Gain on Equity Investment | $9,918 | $0 | N/A | | Net Income (Loss) | $18,602 | $(24,786) | Turnaround | | Diluted EPS | $0.37 | $(0.52) | Turnaround | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities significantly improved to $5.4 million in Q1 2024, while investing activities used $46.5 million, ending the period with $257.9 million in cash Cash Flow Activity | Cash Flow Activity | Q1 2024 (in thousands) | Q1 2023 (in thousands) | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $5,406 | $(13,740) | | Net cash used in investing activities | $(46,473) | $(107,365) | | Net cash provided by financing activities | $2,090 | $325,513 | | **Net Change in Cash** | **$(38,977)** | **$204,408** | | Cash at end of period | $257,894 | $337,143 | - The significant cash provided by financing activities in Q1 2023 was due to the issuance of **$393.5 million** in convertible senior notes[21](index=21&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Key notes include a $9.9 million gain on an equity investment, the issuance of $402.5 million in convertible senior notes in March 2023, and details on a legal dispute with a former distributor - The company recognized a **$9.9 million gain** on an equity investment after the investee completed an equity funding round, allowing for a fair value adjustment under ASC 321[32](index=32&type=chunk) - In March 2023, the company issued **$402.5 million** of 3.0% convertible senior notes due 2028, with an initial conversion price of approximately **$69.68 per share**[59](index=59&type=chunk)[62](index=62&type=chunk) - The company is in a legal dispute with former distributor Phillips Feed Service, Inc. over an alleged breach of contract, with a non-jury trial scheduled for September 16, 2024, though management does not expect a material adverse effect[89](index=89&type=chunk)[91](index=91&type=chunk)[92](index=92&type=chunk) Net Sales by Channel | Net Sales by Channel | Q1 2024 (in thousands) | Q1 2023 (in thousands) | | :--- | :--- | :--- | | Grocery, Mass, International and Digital | $184,429 | $140,179 | | Pet Specialty and Club | $39,420 | $27,343 | | **Total Net Sales** | **$223,849** | **$167,522** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes strong Q1 2024 performance to a 33.6% net sales increase, improved gross margin to 39.4%, and positive income from operations, with plans for significant capital expenditures [Results of Operations](index=24&type=section&id=Results%20of%20Operations) Q1 2024 results show net sales growth of 33.6%, gross profit margin expansion to 39.4%, and a turnaround to $18.6 million net income from a prior-year loss Metric | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net Sales | $223.8M | $167.5M | | % Change | +33.6% | - | | Volume Growth | +30.6% | - | | Gross Profit | $88.2M | $50.8M | | Gross Margin | 39.4% | 30.3% | | SG&A as % of Sales | 35.6% | 43.1% | | Income (Loss) from Operations | $8.5M | $(21.5)M | | Net Income (Loss) | $18.6M | $(24.8)M | - The increase in gross profit margin was primarily due to improved leverage on plant expenses, reduced quality costs, and lower input costs as a percentage of sales[111](index=111&type=chunk) - The decrease in SG&A as a percentage of net sales was mainly a result of reduced logistics costs and media spend as a percentage of net sales, in addition to lower share-based compensation[113](index=113&type=chunk) [Non-GAAP Financial Measures](index=27&type=section&id=Non-GAAP%20Financial%20Measures) Non-GAAP measures highlight strong Q1 2024 performance, with Adjusted EBITDA surging to $30.6 million and Adjusted Gross Profit reaching $101.5 million Reconciliation of Net Income (Loss) to Adjusted EBITDA | Line Item | Q1 2024 (in thousands) | Q1 2023 (in thousands) | | :--- | :--- | :--- | | Net income (loss) | $18,602 | $(24,786) | | Depreciation and amortization | $15,745 | $14,492 | | Interest income, net of interest expense | $(275) | $2,225 | | Income tax expense | $54 | $70 | | **EBITDA** | **$34,126** | **$(7,999)** | | Gain on equity investment | $(9,918) | - | | Non-cash share-based compensation | $6,221 | $8,415 | | Other adjustments | $150 | $1,571 | | **Adjusted EBITDA** | **$30,579** | **$2,967** | Reconciliation of Gross Profit to Adjusted Gross Profit | Line Item | Q1 2024 (in thousands) | Q1 2023 (in thousands) | | :--- | :--- | :--- | | Gross profit | $88,158 | $50,760 | | Depreciation expense | $10,675 | $10,721 | | Non-cash share-based compensation | $2,622 | $2,956 | | **Adjusted Gross Profit** | **$101,476** | **$64,437** | | Adjusted Gross Margin | 45.3% | 38.5% | [Liquidity and Capital Resources](index=30&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2024, the company maintained $257.9 million in cash and $325.0 million in working capital, with significant capital expenditures planned for facility expansion - The company spent approximately **$46.5 million** on capital expenditures in Q1 2024 and expects to spend an additional **$163.5 million** in the remainder of fiscal 2024, mainly for the expansion of Freshpet Kitchens Ennis[135](index=135&type=chunk) - Working capital decreased by **$13.1 million** from year-end 2023 to **$325.0 million**, primarily due to a **$39.0 million** decrease in cash and a **$10.5 million** increase in accounts payable, partially offset by a **$17.6 million** decrease in accrued expenses[140](index=140&type=chunk) - In March 2023, the company issued **$402.5 million** in convertible notes and terminated its previous Credit Agreement to meet its capital needs[134](index=134&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=35&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company faces market risks including interest rate fluctuations, commodity price volatility, and foreign exchange risk, with European revenue representing only 1% of the total - The company is subject to interest rate risk, which can affect borrowing costs and investment values[155](index=155&type=chunk) - The company faces commodity price volatility for its inputs, which it attempts to manage through pricing actions and cost controls[156](index=156&type=chunk) - Foreign exchange risk exists from operations in Europe (British pound and Euro), but the impact is limited as European revenue constituted only **1%** of the total in Q1 2024[157](index=157&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2024, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation as of the end of the reporting period, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective[160](index=160&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, these controls[161](index=161&type=chunk) [Part II. Other Information](index=37&type=section&id=Part%20II.%20Other%20Information) [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in ordinary course legal proceedings, none of which are expected to have a material adverse effect on its financial condition or operations - The company is involved in ordinary course legal actions but does not expect them to have a material adverse effect on its business[165](index=165&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the Annual Report on Form 10-K have occurred - No material changes to the risk factors reported in the Annual Report have occurred[166](index=166&type=chunk) [Item 5. Other Information](index=38&type=section&id=Item%205.%20Other%20Information) No directors or officers reported the adoption or termination of Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter - No directors or officers reported the adoption or termination of any Rule 10b5-1 trading plans during the first quarter of 2024[169](index=169&type=chunk) [Item 6. Exhibits](index=39&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL documents - The report includes required certifications from the CEO and CFO under Sections 302 and 906 of the Sarbanes-Oxley Act, as well as XBRL data files[171](index=171&type=chunk)

Freshpet (FRPT) came out with quarterly earnings of $0.21 per share, beating the Zacks Consensus Estimate of a loss of $0.22 per share. This compares to loss of $0.52 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 195.45%. A quarter ago, it was expected that this seller of refrigerated fresh pet food would post earnings of $0.09 per share when it actually produced earnings of $0.31, delivering a surprise of 244.44%.Over the l ...