Freshpet (FRPT) Stock Forecast & Price Target

Freshpet reported a revenue of $263 million, reflecting an 18% year-over-year increase that surpassed consensus expectations, driven by a 14.9% rise in volume and a 2.7% improvement in price/mix. The company's adjusted gross margin also demonstrated strong performance, reaching 45.7%, which is an increase of 40 basis points year-over-year and 280 basis points above consensus, attributed to lower input costs and enhanced quality metrics. Additionally, Freshpet plans to refine its marketing strategies to better target high-value customers, historically resulting in increased brand awareness and household penetration.

Freshpet has exhibited a decline in revenue growth, attributed to challenges in attracting new households to switch to its products, resulting in a significant shortfall from the previously anticipated 20% topline growth. The company has proactively reduced its FY25 capital expenditure guidance by $25 million to $225 million in response to the continued slowing consumer environment, indicating a cautious approach to future capacity investments. Furthermore, Freshpet's updated revenue growth guidance now forecasts a range of 15%-18% and adjusted AEBITDA guidance of $190 million to $210 million, reflecting an ongoing adverse market condition that may hinder performance.