Simply Good Foods: Balanced Risk-Reward Amid CEO Return and Gradual Turnaround Outlook

Simply Good Foods, the Consumer Defensive sector company, was revisited by a Wall Street analyst yesterday. Analyst Megan Alexander from Morgan Stanley maintained a Hold rating on the stock and has a $24.00 price target.

Megan Alexander has given his Hold rating due to a combination of factors tied to the recent leadership change and the company’s current fundamentals. The market’s reaction to the return of former CEO Joe Scalzo has been cautiously constructive, reflecting confidence in his prior record of successful execution and acquisitions, but also awareness that the business now faces tougher competitive dynamics and a more complex mix than during his earlier tenure. Management has framed the CEO transition as an effort to restore more consistent performance and realign the company with its traditional margin and marketing playbook, rather than a response to a specific new problem, yet the stock’s meaningful underperformance and recent operational challenges underscore that the turnaround will take time.

At the same time, the reaffirmed fiscal 2026 outlook, including expectations for better revenue trends and margin expansion in the back half, leaves investors weighing potential upside against uncertainty around the feasibility and timing of that improvement. While a new/returning leader can often trigger a broader strategic review, including possible portfolio moves, these types of changes tend to be multi-quarter processes and are not guaranteed. Given the elevated competitive environment, the need to rebuild execution credibility, and the lack of clear near-term catalysts beyond a gradual recovery, Megan Alexander sees risk and reward as roughly balanced. As a result, she maintains a neutral, or Hold, stance on Simply Good Foods at this stage.

In another report released on January 9, TD Cowen also maintained a Hold rating on the stock with a $24.00 price target.