As the Q2 earnings season comes to a close, it’s time to take stock of 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 21 shelf-stable food stocks we track reported a mixed Q2. As a group, revenues missed analysts’ consensus estimates by 0.9% while next quarter’s revenue guidance was 0.7% below.
Inflation progressed towards the Fed’s 2% goal at the end of 2023, leading to strong stock market performance. On the other hand, 2024 has been a bumpier ride as the market switches between optimism and pessimism around rate cuts and inflation. Thankfully, shelf-stable food stocks have been resilient with share prices up 6.7% on average since the latest earnings results.
Best Q2: 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 $515.4 million, up 15.6% year on year. This print exceeded analysts’ expectations by 2%. Overall, it was an exceptional quarter for the company with an impressive beat of analysts’ gross margin and organic revenue growth estimates.
Interestingly, the stock is up 18.9% since reporting and currently trades at $58.68.
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 $788.5 million, down 1.9% year on year, in line with analysts’ expectations. The business had a very strong quarter with an impressive beat of analysts’ earnings estimates.
The market seems happy with the results as the stock is up 6% since reporting. It currently trades at $41.64.
Is now the time to buy TreeHouse Foods? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: 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 $1.61 billion, down 4.9% year on year, falling short of analysts’ expectations by 5.5%. It was a disappointing quarter as it posted underwhelming earnings guidance for the full year and a miss of analysts’ organic revenue growth estimates.
Lamb Weston delivered the weakest full-year guidance update in the group. As expected, the stock is down 18.7% since the results and currently trades at $63.87.
Read our full analysis of Lamb Weston’s results here.
Utz (NYSE:UTZ)
Tracing its roots back to 1921 when Bill and Salie Utz began making potato chips in their kitchen, Utz Brands (NYSE:UTZ) offers salty snacks such as potato chips, tortilla chips, pretzels, cheese snacks, and ready-to-eat popcorn, among others.
Utz reported revenues of $356.2 million, down 1.8% year on year. This result met analysts’ expectations. Overall, it was a strong quarter as it also put up an impressive beat of analysts’ organic revenue growth estimates.
The stock is up 18.1% since reporting and currently trades at $17.52.
Read our full, actionable report on Utz here, it’s free.
J&J Snack Foods (NASDAQ:JJSF)
Best known for its SuperPretzel soft pretzels and ICEE frozen drinks, J&J Snack Foods (NASDAQ:JJSF) produces a range of snacks and beverages and distributes them primarily to supermarket and food service customers.
J&J Snack Foods reported revenues of $440 million, up 3.3% year on year. This result was in line with analysts’ expectations. Aside from that, it was a mixed quarter as it also logged a narrow beat of analysts’ operating margin estimates but a miss of analysts’ gross margin estimates.
The stock is up 2.6% since reporting and currently trades at $163.51.
Read our full, actionable report on J&J Snack Foods here, it’s free.
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