As the Q1 earnings season wraps, let’s dig into this quarter’s best and worst performers in the shelf-stable food industry, including BellRing Brands (NYSE: BRBR) and its peers.
As America industrialized and moved away from an agricultural economy, people faced more demands on their time. Packaged foods emerged as a solution offering convenience to the evolving American family, whether it be canned goods or snacks. Today, Americans seek brands that are high in quality, reliable, and reasonably priced. Furthermore, there's a growing emphasis on health-conscious and sustainable food options. Packaged food stocks are considered resilient investments. People always need to eat, so these companies can enjoy consistent demand as long as they stay on top of changing consumer preferences. The industry spans from multinational corporations to smaller specialized firms and is subject to food safety and labeling regulations.
The 18 shelf-stable food stocks we track reported a slower Q1. As a group, revenues missed analysts’ consensus estimates by 1% while next quarter’s revenue guidance was 0.5% above.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 5.1% since the latest earnings results.
BellRing Brands (NYSE: BRBR)
Spun out of Post Holdings in 2019, Bellring Brands (NYSE: BRBR) offers protein shakes, nutrition bars, and other products under the PowerBar, Premier Protein, and Dymatize brands.
BellRing Brands reported revenues of $588 million, up 18.9% year on year. This print exceeded analysts’ expectations by 1.6%. Despite the top-line beat, it was still a mixed quarter for the company with a solid beat of analysts’ organic revenue estimates but a significant miss of analysts’ gross margin estimates.
BellRing Brands scored the fastest revenue growth but had the weakest full-year guidance update of the whole group. Still, the market seems discontent with the results. The stock is down 0.4% since reporting and currently trades at $65.32.
Is now the time to buy BellRing Brands? Access our full analysis of the earnings results here, it’s free.
Best Q1: Lamb Weston (NYSE: LW)
Best known for its Grown in Idaho brand, Lamb Weston (NYSE: LW) produces and distributes potato products such as frozen french fries and mashed potatoes.
Lamb Weston reported revenues of $1.52 billion, up 4.3% year on year, outperforming analysts’ expectations by 2.4%. The business had a very strong quarter with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ gross margin estimates.
Lamb Weston delivered the highest full-year guidance raise among its peers. However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $53.95.
Is now the time to buy Lamb Weston? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: B&G Foods (NYSE: BGS)
Started as a small grocery store in New York City, B&G Foods (NYSE: BGS) is an American packaged foods company with a diverse portfolio of more than 50 brands.
B&G Foods reported revenues of $425.4 million, down 10.5% year on year, falling short of analysts’ expectations by 6.8%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates.
B&G Foods delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 32.9% since the results and currently trades at $4.24.
Read our full analysis of B&G Foods’s results here.
Kellanova (NYSE: K)
With Corn Flakes as its first and most iconic product, Kellanova (NYSE: K) is a packaged foods company that is dominant in the cereal and snack categories.
Kellanova reported revenues of $3.08 billion, down 3.7% year on year. This number came in 2% below analysts' expectations. Overall, it was a disappointing quarter as it also produced a significant miss of analysts’ EBITDA and EPS estimates.
The stock is flat since reporting and currently trades at $82.36.
Read our full, actionable report on Kellanova here, it’s free.
TreeHouse Foods (NYSE: THS)
Whether it be packaged crackers, broths, or beverages, Treehouse Foods (NYSE: THS) produces a wide range of private-label foods for grocery and food service customers.
TreeHouse Foods reported revenues of $792 million, down 3.6% year on year. This print met analysts’ expectations. It was a strong quarter as it also recorded a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
The stock is flat since reporting and currently trades at $23.58.
Read our full, actionable report on TreeHouse Foods here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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