Freshpet (FRPT) AI Stock Analysis

• Market Cap: $4.37B
• Dividend Yield: N/A
• Average Volume (3M): 1.30M
• Price to Earnings (P/E): 284.3
• Beta (1Y): 1.05
• Revenue Growth: 23.24%
• EPS Growth: 60.35%
• Country: US
• Employees: 1,296
• Sector: Consumer Defensive
• Sector Strength: 69
• Industry: Packaged Foods
• EPS (TTM): -0.26
• Shares Outstanding: 48,777,092
• 10 Day Avg. Volume: 1,288,310
• 30 Day Avg. Volume: 1,296,339
• PEG Ratio: -3.73
• Price to Book (P/B): 3.74
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 300.31
• Enterprise Value/Market Cap: 0.94
• Enterprise Value/Revenue: 1.08
• Enterprise Value/Gross Profit: 10.11
• Enterprise Value/Ebitda: 10.52
• 1Y Price Target: $110.45
• Price Target Upside: 29.26% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 15

• Rating: 65 Neutral
• Price Target: ―

Freshpet's overall score reflects strong revenue growth and a robust equity position, yet challenges with profitability and cash flow need addressing. Technical indicators suggest mixed momentum, while a high P/E ratio signals overvaluation. Revised sales guidance and macroeconomic challenges are concerning, but strategic expansion efforts are positive.

Positive Factors

Consumer Demand

Retail consumption for Freshpet grew about 14%, indicating strong consumer demand.

Financial Performance

Freshpet's revenue of $263M exceeded expectations, with significant year-over-year growth in volume and price/mix.

Market Strategy

Management is focusing on advertising targeting higher-income consumers, which could help maintain demand despite broader economic challenges.

Negative Factors

Consumer Confidence

Declining U.S. consumer confidence and rising economic uncertainty significantly impacted the pace of new customer acquisitions for the Freshpet brand and consumer pet adoption more broadly.

Revenue Outlook

Management adjusted lower its full-year sales and EBITDA outlook.

Sales Projections

Management cut the sales/EBITDA guide ~5% at the mid-points to reflect the current macro headwinds and slower sales environment continuing through the balance of the year.

Freshpet Business Overview & Revenue Model

Company Description

Freshpet, Inc. manufactures and markets natural fresh meals and treats for dogs and cats in the United States, Canada, and Europe. The company sells its products under the Freshpet brand; and Dognation and Dog Joy labels through various classes of retail, including grocery, mass, club, pet specialty, and natural, as well as online. Freshpet, Inc. was incorporated in 2004 and is headquartered in Secaucus, New Jersey.

How the Company Makes Money

Freshpet generates revenue through the sale of its fresh, refrigerated pet food products to a wide range of retail partners, including grocery stores, mass merchandisers, club stores, and pet specialty retailers. The company’s business model centers on producing high-quality, perishable pet food that requires refrigeration, thereby setting it apart from traditional dry or canned pet food. Freshpet's products are positioned as premium offerings, allowing the company to capture higher price points. Additionally, the company benefits from recurring revenue as pet owners regularly purchase food for their pets. Key partnerships with large retail chains and an expanding distribution network significantly contribute to its earnings, along with consistent marketing efforts to raise brand awareness and encourage consumer adoption.

Freshpet Financial Statement Overview

Summary

Freshpet exhibits strong revenue growth and a solid equity position, which are encouraging. However, the company faces challenges with profitability margins and free cash flow generation. While the balance sheet remains robust, improving profitability and cash flow efficiency will be crucial for future growth.

Income Statement

Freshpet has shown strong revenue growth, with a TTM revenue of $1.01 billion, up from $975 million in the previous year. The gross profit margin stands at 40.1%, reflecting efficient cost management. However, the net profit margin is relatively low at 1.5%, and the EBIT margin is also modest at 1.8%. Despite these lower margins, revenue growth is a positive sign for the company.

Balance Sheet

The company maintains a healthy equity ratio of 67.3%, indicating a strong capital structure with significant equity funding. The debt-to-equity ratio is 0.41, suggesting manageable debt levels. However, a declining return on equity, currently at 1.5%, points to challenges in generating returns for shareholders.

Cash Flow

Freshpet's operating cash flow to net income ratio is favorable at 9.8, indicating strong cash generation relative to net income. However, free cash flow growth is a concern, with a TTM free cash flow of $13.07 million, an improvement from a loss, but still relatively low. The free cash flow to net income ratio stands at 0.83, showcasing a need for better cash management.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.01B	975.18M	766.89M	595.34M	425.49M	318.79M
	Gross Profit
406.70M	395.96M	250.87M	186.03M	162.15M	132.91M
	EBIT
18.18M	38.00M	-30.45M	-51.98M	-24.65M	-1.91M
	EBITDA
81.42M	133.40M	41.10M	-14.35M	7.15M	19.21M
	Net Income Common Stockholders
15.63M	46.92M	-33.61M	-55.76M	-27.69M	-3.19M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
257.89M	268.63M	296.87M	132.74M	72.79M	67.25M
	Total Assets
1.48B	1.57B	1.46B	1.13B	784.41M	434.39M
	Total Debt
423.96M	424.09M	425.06M	5.71M	7.09M	8.40M
	Net Debt
166.07M	155.46M	128.18M	-127.03M	-65.69M	-58.85M
	Total Liabilities
502.75M	519.52M	510.97M	93.81M	64.66M	40.22M
	Stockholders Equity
977.84M	1.06B	953.45M	1.03B	719.75M	394.17M
Cash Flow		Free Cash Flow
13.07M	-32.80M	-163.15M	-273.30M	-321.45M	-113.38M
	Operating Cash Flow
153.69M	154.29M	75.94M	-43.23M	647.00K	21.19M
	Investing Cash Flow
-167.11M	-187.09M	-239.09M	-233.36M	-322.10M	-162.46M
	Financing Cash Flow
-741.00K	4.57M	327.29M	336.54M	326.99M	199.04M

Freshpet Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 85.45
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FRPT, the sentiment is Negative. The current price of 85.45 is above the 20-day moving average (MA) of 79.63, above the 50-day MA of 81.23, and below the 200-day MA of 124.63, indicating a neutral trend. The MACD of 1.39 indicates Negative momentum. The RSI at 56.30 is Neutral, neither overbought nor oversold. The STOCH value of 85.75 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FRPT.

Freshpet Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BRFS	77 Outperform	$6.21B	8.73	23.47%	2.40%	3.82%	―
SMPL	76 Outperform	$3.65B	25.27	8.40%	―	11.47%	2.59%
CENT	72 Outperform	$2.11B	19.42	8.07%	―	-4.60%	-26.61%
DAR	71 Outperform	$5.35B	29.69	3.79%	―	-11.02%	-68.34%
FRPT	65 Neutral	$4.37B	284.26	1.54%	―	23.24%	60.35%
Sector *	64 Neutral	$8.88B	14.67	4.78%	173.89%	3.39%	2.18%
JJSF	58 Neutral	$2.27B	29.96	8.20%	2.64%	0.49%	-12.32%

Freshpet Corporate Events

Freshpet Reports Q1 2025 Results with Sales Growth

On May 5, 2025, Freshpet reported its first quarter financial results, showing a 17.6% increase in net sales to $263.2 million compared to the previous year. Despite this growth, the company experienced a net loss of $12.7 million, attributed to increased selling, general, and administrative expenses. Freshpet’s CEO, Billy Cyr, acknowledged the need to adjust growth plans due to economic challenges and updated the company’s 2025 outlook, expecting net sales between $1.12 billion and $1.15 billion, and adjusted EBITDA between $190 million and $210 million. The company aims to navigate current economic headwinds while continuing to deliver long-term value.