WEST Stock Forecast & Price Target

Westrock Coffee Co exhibited a solid sales performance in 4Q24, with a 6.5% increase to $229 million, and the company is projected to achieve total sales growth of 9% in 2025, reaching $914 million. Furthermore, the Sustainable Sourcing & Traceability segment reported an impressive 38% sales increase to $55 million, contributing significantly to overall growth forecasts. Management anticipates around 50% annual growth in adjusted EBITDA for the next two years, driven by enhanced revenue from the core coffee business and effective cost-saving measures.

Westrock Coffee is experiencing significant challenges regarding its profitability, with anticipated adjusted EBITDA margins compressing by 85 basis points to 5.5%, attributed to ongoing pressures in consumer spending and rising coffee prices. The company is projected to face a sales growth of only 1% in 4Q24, primarily driven by a 6.5% decline in the Beverage Solutions segment, which is expected to be partially mitigated by strong growth in the Sustainable Sourcing & Traceability segment. Furthermore, Westrock's 2025 adjusted EBITDA guidance falls short of previous forecasts, indicating uncertainties surrounding demand, production ramp-up at its Conway facility, and related execution challenges.