Simply Good Foods (SMPL): What to Watch Ahead of Earnings

Simply Good Foods (NASDAQ:SMPL) is set to release its earnings tomorrow morning. Here’s a snapshot of what investors should know as the report looms.

The company has had a strong performance recently, exceeding analysts’ revenue expectations by 0.6% in the last quarter. It reported $375.7 million in revenue, marking a solid 17.2% year-over-year growth. Additionally, Simply Good Foods significantly outperformed EBITDA estimates, showing robust operational efficiency.

This quarter, analysts project revenue of $347.3 million—a 12.5% increase compared to last year’s figure for the same period. Adjusted earnings per share (EPS) are forecasted at $0.46. Notably, analysts haven’t changed their estimates in the past month, suggesting confidence in the company’s stability.

However, Simply Good Foods has missed revenue expectations three times in the last two years. This adds an element of caution as the company heads into the report.

Competitive Landscape

To contextualize Simply Good Foods’ performance, we can look at peers in the shelf-stable food sector. General Mills (NYSE:GIS) recently reported a modest 2% revenue growth, exceeding expectations by 1.9%, while Conagra’s (NYSE:CAG) revenue remained flat but still managed to beat forecasts by 1.5%. Both stocks saw muted market reactions post-earnings.

The broader shelf-stable food segment has underperformed recently, with share prices falling 6.6% on average over the past month. Simply Good Foods has fared slightly better, down 5.2%. Its stock currently trades at $37.79, below the average analyst price target of $40.50, potentially indicating an upside if earnings meet or exceed expectations.

Simply Good Foods enters earnings with mixed signals. Strong past performance and stable analyst expectations are positives. Yet, its history of revenue misses and recent stock underperformance mirror broader industry challenges.