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Investing.com - Stifel lowered its price target on The Simply Goods Group (NASDAQ:SMPL) stock to $38.00 from $40.00 on Thursday, while maintaining a Buy rating ahead of the company’s third-quarter results. The stock currently trades at $31.75, near its 52-week low of $31.25, with InvestingPro analysis suggesting the company is currently undervalued.
The firm cited weakening consumption trends and increased risk of Atkins distribution losses in the upcoming fall shelf reset as key factors for the adjustment. Stifel also noted continued Sam’s Club losses for the Atkins brand in its analysis. Despite these challenges, the company maintains strong fundamentals with revenue growth of 11.47% and a healthy current ratio of 4.27.
Recent measured channel trends for Atkins show accelerating sales growth declines driven by worsening distribution and base velocity trends, according to Stifel. The percentage of volume sold on promotion is also declining at an accelerating rate.
The Simply Goods Group now trades below a 12x EV/EBITDA multiple based on Stifel’s fiscal year 2026 estimates. The firm believes this valuation undervalues the growth potential of the portfolio as Quest and OWYN brands are expected to represent more than two-thirds of revenue.
The company is scheduled to release its third-quarter 2025 financial results on July 10.
In other recent news, The Simply Good Foods Group has seen various developments that could impact investor decisions. Mizuho (NYSE:MFG) Securities raised its price target for the company to $47.00, maintaining an Outperform rating after Simply Good Foods reported revenue and EBITDA figures that exceeded consensus estimates. The strong performance was attributed to favorable commodity timing and successful product distribution, particularly with its Quest and OWYN brands. Conversely, Citi lowered its price target to $40.00, citing potential sales misses and narrowing guidance for fiscal year 2025, although it maintained a Buy rating. DA Davidson also adjusted its target to $38.00, expressing concerns over brand optimization and cost inflation, while keeping a Neutral rating. Additionally, UBS initiated coverage with a Neutral rating and a $41.00 price target, acknowledging the company’s growth potential but noting that market expectations already reflect this. In corporate news, Simply Good Foods announced the appointment of Christopher J. Bealer as the new CFO, effective July 3, 2025, and amended its Executive Severance Plan. These recent developments reflect a mix of optimistic and cautious outlooks from analysts, highlighting the complex market environment the company is navigating.
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