Citi cuts BellRing Brands target to $80, maintains Buy rating

On Wednesday, Citi analysts adjusted their outlook on BellRing Brands (NYSE:BRBR), reducing the stock’s price target from $90.00 to $80.00 while still recommending a Buy rating. This change follows a significant drop in BRBR shares, which fell 19% on Tuesday due to the company’s second-quarter sales exceeding expectations but only reiterating its full-year 2025 guidance. The stock’s recent performance reflects broader market concerns, with InvestingPro data showing a -17.62% return over the past week, despite maintaining strong revenue growth of 18.91% over the last twelve months. Additionally, BellRing Brands disclosed potential sales challenges in the third quarter due to inventory reductions by a major club customer.

The company had been a popular investment in the consumer staples sector, often delivering results that exceeded Wall Street’s expectations. However, the recent earnings report and the company’s outlook have led to a swift change in investor sentiment. Despite the sharp decline in share value, Citi analysts believe the current sell-off does not align with the company’s fundamentals.

Following a detailed discussion with BellRing Brands’ management, Citi analysts came away with a positive outlook. They are confident that the inventory reduction does not indicate a decrease in demand for Premier protein shakes or impending reductions in shelf space at retailers. Based on these insights, Citi anticipates sales growth for BellRing Brands could pick up in the fourth quarter of 2025, potentially surpassing levels previously anticipated.

The price target adjustment by Citi reflects a cautious yet optimistic view of BellRing Brands’ future performance, suggesting that the current market reaction may be an overextension of the underlying business realities. The company’s consistent track record and reassurances from management appear to underpin Citi’s continued endorsement of the stock with a Buy rating. InvestingPro analysis suggests the stock is currently slightly undervalued, with analyst targets ranging from $72.96 to $92.00. For deeper insights into BRBR’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

In other recent news, BellRing Brands reported its second-quarter 2025 earnings, with revenue reaching $588 million, surpassing the forecast of $577.61 million. The company’s earnings per share matched analyst expectations at $0.53. Despite these results, BellRing’s stock experienced a 15% drop, attributed to broader market trends and concerns over tariffs and inventory issues. The company’s revenue increased by 19% year-over-year, and adjusted EBITDA rose by 14% to $119 million. BellRing’s market share in the ready-to-drink segment remains strong at 27%.

Additionally, JPMorgan analyst Ken Goldman adjusted the price target for BellRing Brands, reducing it from $85 to $80 while maintaining an Overweight rating. This revision came after a significant drop in BellRing’s share value, partly due to the company not raising its top-line guidance amid macroeconomic uncertainties. Goldman noted that the third quarter is expected to show weaker-than-anticipated sales growth due to a reduction in customer orders.

The company has launched new products, including the Premier Protein Indulgence line, and continues to focus on innovation and expanding household penetration. BellRing projects full-year net sales between $2.26 billion and $2.34 billion, reflecting a 13-17% increase. However, potential tariff impacts on dairy protein inputs in fiscal 2026 remain a concern.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.