Vital Farms: Long-Term Growth Potential Outweighs Minor Short-Term Revenue Adjustment

Needham analyst Gerald Pascarelli has reiterated their bullish stance on VITL stock, giving a Buy rating today.

Gerald Pascarelli has given his Buy rating due to a combination of factors that highlight Vital Farms’ promising long-term growth potential despite a minor short-term revenue adjustment. The company has slightly reduced its 2025 revenue forecast by less than 2%, which, although unexpected, does not reflect current demand issues. This adjustment may temporarily overshadow the otherwise strong financial outlook, which includes maintaining its 2025 EBITDA target and reducing capital expenditures.
Vital Farms has extended its growth outlook to 2030, aiming for significant revenue and margin improvements. The company projects a revenue target of $2 billion by 2030, with a gross margin exceeding 35% and an EBITDA margin between 15-17%. This ambitious plan suggests a compound annual growth rate of over 21% from the 2025 base, indicating robust future performance. Despite the potential for short-term market overreactions, Pascarelli remains confident in the company’s strategic direction and long-term prospects.