Truist maintains BellRing Brands hold with $75 target

On Tuesday, Truist Securities maintained a Hold rating on BellRing Brands (NYSE:BRBR) shares, with a price target of $75.00. The company, currently valued at $9.74 billion, recently reported its F1Q25 results, which surpassed both net sales and adjusted EBITDA expectations. According to InvestingPro data, the company has demonstrated impressive revenue growth of 19.76% over the last twelve months. Analysts at Truist noted that this marks another strong quarter for BellRing Brands, highlighting the second consecutive period of accelerated consumption of Premier Protein Ready-To-Drink (RTD) products.

Despite the positive results, Truist analysts predict that the stock will open flat the following day. They attribute this forecast to the stock already reflecting the favorable first-quarter performance, which has led to a 6.8% increase since the last earnings report. This performance is compared to the Consumer Staples Select Sector SPDR Fund’s (XLP) 2.1% gain over the same period. InvestingPro analysis reveals even more impressive gains, with the stock delivering a 57.54% return over the past six months.

The company’s updated guidance, which has been raised to match the first-quarter beat, is seen by Truist as a neutral adjustment. It maintains the balance of the year’s guidance by incorporating the quarter’s positive results into the original forecast. The analysts believe that BellRing Brands shares are trading at an appropriate level, approximately 23 times their FY25 EBITDA estimate, which is in line with the average of ~20 times for the high-growth Consumer Packaged Goods (CPG) cohort. Based on InvestingPro’s Fair Value analysis, the stock appears to be trading above its intrinsic value, with current EV/EBITDA multiple at 25.64x and P/E ratio at 41.37x.

In an additional strategic move, BellRing Brands management has shifted its internal data sourcing. This change is expected to improve coverage of the business, with about 85% now monitored by MULO+C data, which should result in fewer surprises in earnings outcomes. The Truist analysts have decided to maintain their Hold rating on the stock, reflecting their view that the shares are currently valued correctly in the market. For deeper insights into BRBR’s valuation and growth prospects, investors can access the comprehensive Pro Research Report available on InvestingPro, which includes 13 additional key insights about the company’s performance and outlook.

In other recent news, BellRing Brands has seen significant changes in its corporate governance structure, including the declassification of its Board of Directors, following shareholder approval. In the financial sector, the company has been the focus of various analyst firms. Citi raised the price target for BellRing Brands to $90, maintaining a Buy rating, while anticipating the company to outperform consensus estimates for organic sales growth and EBITDA. Stephens also increased its price target for BellRing to $75, noting potential market share gains, but raised concerns about premium valuation. Mizuho (NYSE:MFG) Securities increased its price target to $80, citing BellRing’s first significant marketing investments in four years and innovative product line. Evercore ISI also increased its price target to $78, highlighting a 15%+ organic sales growth in BellRing’s performance. These are among the recent developments for BellRing Brands.

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