• May 2025 Corporate Presentation (Nasdaq: VITL) Vital Farms, Inc. Reporting Disclaimer This presentation contains, in addition to historical information, certain "forward-looking statements" (within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended), that are based on our current assumptions, expectations and projections about future performance and events and relate to, among other matters, our future financial performa ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________ to ______________ Commission File Number: 001-39411 Vital Farms, Inc. (Exact name of registrant as specified in its charter) Delaware 27-049698 ...

Reaffirms Fiscal Year 2025 Outlook of $740 Million in Net Revenue and $100 Million in Adjusted EBITDA On Track to Reach $1 Billion Net Revenue Target in 2027 Vital Farms Reports First Quarter 2025 Financial Results Record First Quarter Net Revenue of $162.2 Million, Up 9.6% Versus Prior Year Period "We delivered first quarter results that were in-line with our overall expectations and made good progress on our key 2025 strategic initiatives, said Russell Diez-Canseco, Vital Farms' President and Chief Execut ...

Core Insights - Vital Farms reported a record first quarter net revenue of $162.2 million, representing a 9.6% increase compared to the prior year period [1][3][6] - The company reaffirmed its fiscal year 2025 outlook, targeting $740 million in net revenue and $100 million in adjusted EBITDA, while remaining on track to achieve a $1 billion net revenue target by 2027 [1][12][15] Financial Performance - Net revenue for the first quarter increased to $162.2 million from $147.9 million, driven by price/mix benefits of $12.4 million and volume-related growth of $1.9 million [3][6] - Gross profit was $62.5 million, or 38.5% of net revenue, compared to $58.9 million, or 39.8% of net revenue in the prior year [4][6] - Income from operations decreased to $21.8 million from $24.2 million, attributed to higher crew member investments [5][6] - Net income was $16.9 million, down from $19.0 million, with net income per diluted share at $0.37 compared to $0.43 in the prior year [7][6] - Adjusted EBITDA was $27.5 million, or 16.9% of net revenue, down from $29.1 million, or 19.7% of net revenue in the prior year [8][6] Operational Highlights - The company has maintained 20 consecutive quarters of year-over-year volume and net revenue growth since its IPO in 2020, with a three-year net revenue CAGR of 28% [2][12] - Vital Farms expanded its network to over 450 family farmers and is on track with internal capacity expansion plans, including a new egg washing and packing line in Missouri [2][12] - The butter business saw a significant growth of 41% in net sales compared to the prior year, benefiting from increased consumer awareness [2][12] Capital Expenditures and Cash Flow - Capital expenditures for the first quarter totaled $3.1 million, up from $1.3 million in the prior year [11] - Cash, cash equivalents, and marketable securities were $161.3 million as of March 30, 2025, with no outstanding debt [10][12] Fiscal Year 2025 Outlook - The company expects net revenue of at least $740 million, representing a minimum of 22% growth versus fiscal year 2024, and adjusted EBITDA of at least $100 million, reflecting at least 15% growth [15][12] - Capital expenditures are projected to be in the range of $50 million to $60 million, focusing on new facilities and digital transformation projects [15][12]

Core Viewpoint - Vital Farms (VITL) has shown a strong performance recently, with shares returning +8.3% over the past month, contrasting with the S&P 500's -0.5% and the Zacks Food - Miscellaneous industry's -4.2% [1] Earnings Estimates Revisions - Vital Farms is expected to post earnings of $0.26 per share for the current quarter, reflecting a year-over-year decline of -39.5% [4] - The consensus earnings estimate for the current fiscal year is $1.23, indicating a +4.2% change from the previous year [4] - For the next fiscal year, the consensus estimate of $1.50 suggests a +22.3% increase compared to the prior year [5] - The Zacks Consensus Estimate has seen a slight decrease of -0.9% for the current quarter and -0.2% for the current fiscal year over the last 30 days [4][5] Revenue Growth Projections - The consensus sales estimate for the current quarter is $162.62 million, representing a year-over-year increase of +9.9% [10] - For the current fiscal year, the revenue estimate is $740.79 million, indicating a +22.2% change, while the next fiscal year's estimate of $877.65 million reflects an +18.5% change [10] Last Reported Results and Surprise History - In the last reported quarter, Vital Farms achieved revenues of $165.99 million, a +22.2% increase year-over-year, and an EPS of $0.23 compared to $0.17 a year ago [11] - The company exceeded the Zacks Consensus Estimate for revenues by +3.6% and for EPS by +53.33% [11] - Vital Farms has consistently beaten consensus EPS and revenue estimates in the last four quarters [12] Valuation - Vital Farms has a Zacks Value Style Score of D, indicating it is trading at a premium compared to its peers [16] - Valuation multiples such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF) are essential for assessing whether the stock is overvalued, fairly valued, or undervalued [14][16] Conclusion - The Zacks Rank of 3 suggests that Vital Farms may perform in line with the broader market in the near term [17]

Group 1 - Vital Farms (VITL) closed at $33.83, with a +0.56% change, lagging behind the S&P 500's daily gain of 0.58% [1] - Over the past month, shares of Vital Farms gained 10.4%, outperforming the Consumer Staples sector's loss of 0.35% and the S&P 500's loss of 0.84% [1] Group 2 - The upcoming earnings report for Vital Farms is expected on May 8, 2025, with projected earnings per share (EPS) of $0.26, reflecting a 39.53% decrease from the same quarter last year [2] - Revenue is anticipated to be $162.62 million, indicating a 9.93% increase from the same quarter last year [2] Group 3 - For the full year, analysts expect earnings of $1.23 per share and revenue of $740.79 million, marking changes of +4.24% and +22.18% respectively from last year [3] Group 4 - Recent changes in analyst estimates for Vital Farms are important as they indicate shifts in near-term business trends, with positive revisions suggesting analyst optimism regarding the company's profitability [4] Group 5 - The Zacks Rank system, which evaluates estimate changes, indicates that Vital Farms currently holds a Zacks Rank of 3 (Hold), with a consensus EPS projection moving 0.16% lower in the past 30 days [6] Group 6 - Vital Farms has a Forward P/E ratio of 27.39, which is higher than the industry average of 15.47, suggesting that the company is trading at a premium [7] - The Food - Miscellaneous industry, part of the Consumer Staples sector, has a Zacks Industry Rank of 83, placing it in the top 34% of over 250 industries [7]

Core Insights - Vital Farms (VITL) stock closed at $33.64, reflecting a +0.78% change from the previous session, outperforming the S&P 500's daily gain of 0.06% [1] - The company experienced a significant gain of 12.31% over the past month, surpassing the Consumer Staples sector's gain of 2.15% and the S&P 500's loss of 4.29% [1] Earnings Expectations - Vital Farms is set to release its earnings report on May 8, 2025, with analysts expecting earnings of $0.26 per share, indicating a year-over-year decline of 39.53% [2] - The consensus estimate for revenue is $162.62 million, representing a 9.93% increase from the prior-year quarter [2] Full Year Projections - For the full year, analysts anticipate earnings of $1.23 per share and revenue of $740.79 million, reflecting changes of +4.24% and +22.18% respectively from the previous year [3] Analyst Estimate Revisions - Recent adjustments to analyst estimates for Vital Farms are crucial as they reflect short-term business trends, with positive revisions indicating a favorable business outlook [4] - The Zacks Rank system, which evaluates these estimate changes, suggests that stocks with positive revisions tend to perform better [5] Zacks Rank and Valuation - Vital Farms currently holds a Zacks Rank of 3 (Hold), with a recent 0.16% decrease in the consensus EPS estimate over the last 30 days [6] - The company has a Forward P/E ratio of 27.18, which is higher than the industry average of 15.63, indicating that it is trading at a premium [7] Industry Context - The Food - Miscellaneous industry, part of the Consumer Staples sector, has a Zacks Industry Rank of 154, placing it in the bottom 38% of over 250 industries [7] - The Zacks Industry Rank assesses the strength of industry groups, showing that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [8]

Company Overview - Vital Farms is a Certified B Corporation that offers a range of ethically produced foods nationwide [3] - The company started in 2007 on a single farm in Austin, Texas, and has grown to work with over 425 family farms [3] - Vital Farms is the leading U.S. brand of pasture-raised eggs by retail dollar sales [3] - The company emphasizes humane treatment of farm animals and sustainable farming practices [3] - Vital Farms' products include shell eggs, butter, hard-boiled eggs, and liquid whole eggs, sold in approximately 24,000 stores nationwide [3] Upcoming Financial Results - Vital Farms will report financial results for the first quarter ended March 30, 2025, on May 8, 2025, before market open [1] - A conference call and webcast will be held at 8:30 a.m. ET on the same day to discuss the results [2] - Participants can access the live call via specific phone numbers or through the Vital Farms Investor Relations website [2]

Core Insights - Vital Farms published its 2025 Impact Report, showcasing progress in driving positive outcomes for stakeholders and the company's success [1][3] Group 1: Building a Resilient Food System - Reduced operational emissions intensity by 17.7% at Egg Central Station (ECS) since 2023 [8] - Engaged nearly 50% of its farmer network in additional regenerative agriculture practices, aiming for 100% engagement by the end of 2026 [8] - Achieved LEED® Gold Certification at ECS, indicating excellence in environmental stewardship [8] Group 2: Fostering a People-First Culture - Achieved Great Place to Work (GPTW) Certification by surpassing the 80% threshold in the accreditation survey [8] - Launched the first company-wide Ethics Week, including a panel discussion and revamped Code of Business Conduct and Ethics [8] - Set a goal for 95% of crew members to complete ethics and compliance training by the end of 2025 [8] Group 3: Driving Engaged & Accountable Oversight - Achieved an Elite Excellent 99% rating from an annual Safe Quality Food (SQF) audit, reflecting high standards in food safety and quality [8] - Provided over $600,000 in philanthropy to strengthen communities where Vital Farms operates [8] - Successfully recertified as a B Corp for the fourth time, meeting high standards of social and environmental performance [8]

Core Viewpoint - Brokerage recommendations, particularly for Vital Farms (VITL), suggest a strong buy sentiment, but reliance solely on these recommendations may not be advisable due to potential biases from brokerage firms [2][5][10]. Group 1: Brokerage Recommendations - Vital Farms has an average brokerage recommendation (ABR) of 1.06, indicating a consensus between Strong Buy and Buy, with 88.9% of recommendations being Strong Buy and 11.1% being Buy [2]. - The ABR is calculated based on recommendations from nine brokerage firms, with eight recommending Strong Buy and one recommending Buy [2]. - Despite the positive ABR, studies indicate that brokerage recommendations often do not effectively guide investors towards stocks with significant price appreciation potential [5][10]. Group 2: Analyst Bias and Reliability - Analysts from brokerage firms tend to exhibit a strong positive bias in their ratings due to vested interests, leading to a disproportionate number of favorable ratings compared to negative ones [6][10]. - The Zacks Rank, which is based on earnings estimate revisions, is presented as a more reliable indicator of a stock's near-term price performance compared to the ABR [8][11]. - The Zacks Rank is timely and reflects current earnings estimates, while the ABR may not always be up-to-date [12]. Group 3: Earnings Estimates and Performance - The Zacks Consensus Estimate for Vital Farms remains unchanged at $1.24 for the current year, indicating steady analyst views on the company's earnings prospects [13]. - The Zacks Rank for Vital Farms is currently 3 (Hold), suggesting a cautious approach despite the favorable ABR [14].