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Freshpet
(NASDAQ:FRPT)
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Rating:79Outperform
Price Target:
$71.00
▲(23.39% Upside)
Action:Reiterated
Date:08/05/26
FRPT scores well on fundamentals as profitability and free cash flow have inflected sharply upward, supported by manageable leverage. The earnings call further strengthens the outlook with raised 2026 sales/EBITDA guidance and improved longer-term margin targets, while technicals show a steady uptrend with positive momentum. The main offsets are the recent slowdown in TTM revenue growth and near-term cost pressures (notably logistics and start-up quality costs), with valuation moderately supportive based on the provided P/E and no dividend yield.
Positive Factors
Margin expansion & profitability
Freshpet’s meaningful margin inflection reflects sustained operating leverage from scale and mix improvements. Higher gross and EBIT margins provide durable earnings power, enabling reinvestment in capacity, marketing and buybacks while improving resilience to cost swings over a 2–6 month horizon and beyond.
Negative Factors
Slowing revenue growth
Top-line deceleration is a structural concern: slower household penetration and tougher comps reduce the leverage of fixed costs and extend the time to realize margin targets. If sustained, muted revenue growth could force higher marketing or trade investment to restore trajectory, pressuring margins.
Read all positive and negative factors
Positive Factors
Negative Factors
Margin expansion & profitability
Freshpet’s meaningful margin inflection reflects sustained operating leverage from scale and mix improvements. Higher gross and EBIT margins provide durable earnings power, enabling reinvestment in capacity, marketing and buybacks while improving resilience to cost swings over a 2–6 month horizon and beyond.
Read all positive factors
Freshpet Key Performance Indicators (KPIs)
Any
Net Sales by Retailer
Shows how much revenue comes from each retailer and how concentrated sales are among a few chains. High concentration in one or two retailers increases risk if stocking, pricing, or promotional support changes, while diversified retail distribution supports steadier growth and better negotiating power. Also reveals whether revenue gains are driven by new store listings, higher sales per store, or discounting, giving insight into the durability of Freshpet’s growth and margins.
Shows how much revenue comes from each retailer and how concentrated sales are among a few chains. High concentration in one or two retailers increases risk if stocking, pricing, or promotional support changes, while diversified retail distribution supports steadier growth and better negotiating power. Also reveals whether revenue gains are driven by new store listings, higher sales per store, or discounting, giving insight into the durability of Freshpet’s growth and margins.
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The Fly
The FlyFreshpet (FRPT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.93B
Dividend YieldN/A
Average Volume (3M)1.31M
Price to Earnings (P/E)14.5
Beta (1Y)1.05
Revenue Growth12.01%
EPS Growth1171.89%
CountryUS
Employees1,288
SectorConsumer Defensive
Sector Strength42
IndustryPackaged Foods
Share Statistics
EPS (TTM)4.16
Shares Outstanding49,142,790
10 Day Avg. Volume1,016,368
30 Day Avg. Volume1,312,118
Financial Highlights & Ratios
PEG Ratio0.11
Price to Book (P/B)2.46
Price to Sales (P/S)2.70
P/FCF Ratio240.23
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$80.13Price Target Upside39.25% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
EPS Forecast (FY)1.82
Revenue Forecast (FY)$1.21B
Freshpet Business Overview & Revenue Model
Company Description
Freshpet, Inc. produces and distributes natural, fresh, and ready-to-eat food and treats specifically formulated for dogs and cats. These products are available to consumers throughout the United States, Canada, and Europe. The company offers its ...
How the Company Makes Money
Freshpet makes money primarily by selling refrigerated pet food and treats to retailers and other customers (with revenue recognized from product sales). Its core revenue stream is branded product sales (Freshpet-branded fresh, refrigerated dog an...
Freshpet Earnings Call Summary
Earnings Call Date:Aug 05, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 09, 2026
Earnings Call Sentiment Positive
The call conveyed a broadly positive view: strong Q2 sales, margin expansion, improved cash flow and e-commerce/retail distribution momentum led management to raise 2026 sales and adjusted EBITDA guidance and to increase the 2027 gross margin floor. That said, the company acknowledged clear near-term headwinds—higher logistics costs, start-up quality expenses from new manufacturing technology, a cautious consumer backdrop, and intensifying competition—that inject uncertainty into short-term cadence. Overall, results, balance sheet strength and strategic manufacturing/omnichannel initiatives outweigh the near-term operational and macro challenges.Positive Updates
Strong Top-Line Growth
Q2 net sales of $305.6M, up 15.5% year-over-year (volume +15.7%, price/mix -0.2%); Nielsen-measured U.S. pet retail + Costco growth 12.9%; company raised 2026 net sales growth guidance to 10%–12% (from 8%–11%).
Negative Updates
Macro and Consumer Headwinds
Management called out a challenging consumer backdrop—higher gas prices and weaker consumer sentiment—impacting trade-up behavior; household penetration sequential growth showing signs of slowing and Q3 faces a tougher comp that will reduce YoY growth by ~2 points.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Top-Line Growth
Q2 net sales of $305.6M, up 15.5% year-over-year (volume +15.7%, price/mix -0.2%); Nielsen-measured U.S. pet retail + Costco growth 12.9%; company raised 2026 net sales growth guidance to 10%–12% (from 8%–11%).
Read all positive updates
Company Guidance
Freshpet raised its 2026 outlook, now expecting net sales growth of 10–12% (up from 8–11%) and adjusted EBITDA of $210–220M (a ~7–12% increase YoY vs. prior $205–215M), with media expected at roughly 12.5% of sales and adjusted gross margin now projected to expand ~100–150 bps in 2026 (vs. 50–100 bps prior), including ~25 bps from new bag technology this year and a >100‑bp annualized benefit when fully optimized (expected to scale in 2027); CapEx remains ~ $150M for 2026, the guidance assumes an incremental ~$8M of logistics costs, and management has executed $86.5M of a $150M buyback (1.6M shares) while ending the quarter with $350.8M cash. The guidance is anchored by strong Q2 results: net sales $305.6M (+15.5% YoY), adjusted EBITDA $52.2M (+18%), adjusted gross margin 48.6% (+170 bps), adjusted SG&A 31.4% of sales, logistics 6.9% (vs. 5.7% prior year), digital orders +41% to 16.7% of sales (≈78% fulfilled via fridges), total distribution points +13%, and consumer metrics showing MVPs (who spend ~5x the average) account for 71% of sales while 52‑week household penetration +5% and buy rate +7% (13% combined). For FY2027 management reiterated an adjusted EBITDA margin target of 20–22% and raised the adjusted gross margin floor to at least 49%.Freshpet Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
72
Positive
Cash Flow
83
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.18B | 1.10B | 975.18M | 766.89M | 595.34M | 425.49M |
| Gross Profit | 462.59M | 425.20M | 395.96M | 250.87M | 186.03M | 162.15M |
| EBITDA | 251.24M | 171.76M | 133.40M | 41.10M | -15.72M | 5.82M |
| Net Income | 203.47M | 139.14M | 46.92M | -33.61M | -59.49M | -29.70M |
Balance Sheet | ||||||
| Total Assets | 1.81B | 1.78B | 1.57B | 1.46B | 1.13B | 784.41M |
| Cash, Cash Equivalents and Short-Term Investments | 350.81M | 277.98M | 268.63M | 296.87M | 132.74M | 72.79M |
| Total Debt | 493.66M | 560.01M | 424.09M | 425.06M | 5.71M | 7.09M |
| Total Liabilities | 574.72M | 569.12M | 519.52M | 510.97M | 93.81M | 64.66M |
| Stockholders Equity | 1.24B | 1.21B | 1.06B | 953.45M | 1.03B | 719.75M |
Cash Flow | ||||||
| Free Cash Flow | 181.28M | 12.38M | -32.80M | -163.15M | -273.30M | -321.45M |
| Operating Cash Flow | 246.95M | 160.56M | 154.29M | 75.94M | -43.23M | 647.00K |
| Investing Cash Flow | 22.28M | -148.18M | -187.09M | -239.09M | -233.36M | -322.10M |
| Financing Cash Flow | -58.70M | -3.04M | 4.57M | 327.29M | 336.54M | 326.99M |
Freshpet Technical Analysis
Positive
57.54
Price Trends
55.45
Positive
58.23
Positive
61.46
Positive
Market Momentum
2.46
Negative
75.73
Negative
76.42
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FRPT, the sentiment is Positive. The current price of 57.54 is below the 20-day moving average (MA) of 58.65, above the 50-day MA of 55.45, and below the 200-day MA of 61.46, indicating a bullish trend. The MACD of 2.46 indicates Negative momentum. The RSI at 75.73 is Negative, neither overbought nor oversold. The STOCH value of 76.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FRPT.
Freshpet Risk Analysis
Freshpet disclosed 36 risk factors in its most recent earnings report. Freshpet reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Freshpet Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $2.93B | 14.52 | 16.65% | ― | 12.01% | 1171.89% | |
68 Neutral | $1.43B | 25.55 | 5.40% | 4.19% | -2.04% | -23.39% | |
66 Neutral | $2.43B | 15.54 | 10.72% | ― | 0.22% | 46.14% | |
65 Neutral | $1.66B | 11.51 | 5.28% | 5.80% | 4.84% | -31.84% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
62 Neutral | $12.75B | -91.74 | -2.44% | 3.72% | 3.72% | 88.76% | |
57 Neutral | $900.53M | -4.69 | -12.33% | ― | -4.48% | -250.67% |
* Consumer Defensive Sector Average
FRPT
Freshpet
66.73
2.75
4.30%
CENT
Central Garden Pet
46.54
11.45
32.65%
JJSF
J & J Snack Foods
91.86
-12.20
-11.72%
SJM
JM Smucker
118.80
12.30
11.55%
SMPL
Simply Good Foods
11.17
-18.84
-62.78%
NOMD
Nomad Foods
11.78
-3.14
-21.05%
Freshpet Corporate Events
Business Operations and StrategyStock BuybackFinancial Disclosures
Freshpet Raises 2026 Outlook After Strong Q2 Results
Positive
Aug 5, 2026
On August 5, 2026, Freshpet reported second-quarter 2026 results showing net sales up 15.5% to $305.6 million, gross margin improved to 42.1% and adjusted EBITDA rising to $52.2 million, with net income increasing to $19.5 million on stronger sale...
Executive/Board Changes
Freshpet announces leadership transition as president retires
Neutral
Jun 24, 2026
Freshpet, Inc. announced on June 22, 2026, that co-founder and President Scott Morris will retire effective October 20, 2026, and will remain through that date to support a smooth leadership transition. Under a letter agreement, he will receive hi...
Executive/Board ChangesShareholder Meetings
Freshpet Shareholders Back Board, Auditor and Executive Pay
Positive
Jun 11, 2026
At its 2026 Annual Meeting of Stockholders held on June 10, 2026, Freshpet stockholders elected all 12 director nominees to the board, with each candidate receiving strong majority support despite some variation in opposition and abstentions. The ...
Business Operations and StrategyFinancial Disclosures
Freshpet Delivers Strong Q1 Results and Raises Outlook
Positive
May 6, 2026
Freshpet reported strong first quarter 2026 results on May 6, 2026, with net sales rising 13.1% year over year to $297.6 million, driven mainly by volume gains, and gross margin improving to 40.5% on lower input costs and better plant leverage. Th...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.