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MGP Ingredients (MGPI)
NASDAQ:MGPI
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MGP Ingredients
(NASDAQ:MGPI)
Rating:64Neutral
Price Target:
$31.00
▲(6.20% Upside)
Positive Factors
Contract Negotiations
Management highlighted better visibility with Brown Goods customers through proactive contract negotiations.
Sales Growth
Premium+ brands remained solid with sales growth, driven by Penelope, with strong scanner trends for El Mayor and Rebel 100.
Negative Factors
Brand Trends
The guide-down was driven by poor mid + value brand trends, which are now expected to decline double digits in 2025.
Branded Spirits Sales
Weak Branded Spirits sales weighed on the investment case for closing the valuation gap.
MGP Ingredients (MGPI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$624.09M
Dividend Yield1.64%
Average Volume (3M)207.09K
Price to Earnings (P/E)67.4
Beta (1Y)0.84
Revenue Growth-22.65%
EPS Growth-107.16%
CountryUS
Employees660
SectorConsumer Defensive
Sector Strength50
IndustryBeverages - Wineries & Distilleries
Share Statistics
EPS (TTM)0.97
Shares Outstanding21,292,736
10 Day Avg. Volume186,789
30 Day Avg. Volume207,091
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.49
Enterprise Value/Revenue1.42
Enterprise Value/Gross Profit3.49
Enterprise Value/Ebitda13.59
Forecast
1Y Price Target
$37.80Price Target Upside29.50% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
MGP Ingredients Business Overview & Revenue Model
Company DescriptionMGP Ingredients, Inc. is a leading provider of premium distilled spirits and specialty wheat proteins and starches, headquartered in Atchison, Kansas. The company operates primarily in two sectors: the distilled spirits sector, which includes whiskey, vodka, and other spirits, and the ingredient sector, which focuses on the production of high-quality proteins and starches for food and industrial applications. MGP's core products cater to a wide range of customers, including food and beverage manufacturers, distillers, and consumers, establishing it as a versatile player in the food and beverage industry.
How the Company Makes MoneyMGP Ingredients generates revenue through multiple key streams. The primary revenue source is its distilled spirits segment, where the company produces and sells a diverse range of spirits, including bourbon, rye, and vodka, both under its own brands and through custom production agreements for other companies. Additionally, the company earns revenue from its ingredient segment, which includes the sale of specialty wheat proteins and starches used in various food products, such as meat alternatives and baked goods. Significant partnerships with major beverage companies and food manufacturers enhance its distribution reach and contribute to steady revenue. Furthermore, MGP's focus on innovation and product development, combined with a growing consumer interest in craft spirits and health-conscious ingredients, positions the company to capitalize on emerging market trends.
MGP Ingredients Earnings Call Summary
Earnings Call Date:Jul 31, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 30, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong growth in premium plus branded spirits and improvements in the Ingredient Solutions segment, as well as a solid financial position. However, significant declines in overall revenue and challenges in the Distilling Solutions segment indicate ongoing difficulties. The economic environment continues to present challenges affecting consumer behavior.Q2-2025 Updates
Positive Updates
Strong Performance in Premium Plus Branded Spirits
The premium plus Branded Spirits portfolio posted positive growth with a 1% increase in sales for Q2 2025, compared to the year-ago period. Penelope, a key brand, is expanding into new markets and launching new products.
Improved Cash Flow and Financial Position
Year-to-date operating cash flows increased to $56.4 million versus $29.6 million in the same period last year. The company remains well-capitalized with more than $600 million in availability under debt facilities.
Ingredient Solutions Segment Growth
Ingredient Solutions sales increased by 5% during the second quarter, driven by a rebound in specialty wheat protein sales.
New Distribution Partnership
MGP announced a new partnership with Breakthru Beverage Group for distribution in California, expected to drive growth in the market.
Negative Updates
Overall Revenue and EBITDA Decline
Consolidated sales and adjusted EBITDA decreased by 24% and 38% respectively, compared to the prior year period. This was primarily due to a decline in Distilling Solutions performance.
Distilling Solutions Segment Challenges
Distilling Solutions sales declined by 46%, driven by a 54% decline in brown goods sales. The segment is expected to continue facing challenges into 2026.
Branded Spirits Sales Decline
Branded Spirits sales decreased by 5% due to a double-digit decline in mid and value-priced brands, despite the growth in premium plus brands.
Economic and Consumer Challenges
Overall economic uncertainty, inflation, and higher interest rates are weighing on consumer sentiment, impacting discretionary spending.
Company Guidance
During MGP Ingredients' second quarter earnings call for fiscal year 2025, management provided detailed guidance and performance metrics. Consolidated sales and adjusted EBITDA decreased by 24% and 38%, respectively, compared to the prior year, largely due to a decline in the Distilling Solutions segment. Despite a 5% decline in Branded Spirits sales, the premium plus portfolio showed positive growth, increasing by 1%. Adjusted earnings per share fell to $0.97, while year-to-date operating cash flows increased significantly to $56.4 million from $29.6 million the previous year. The company reaffirmed its 2025 guidance, expecting net sales between $520 million and $540 million, adjusted EBITDA in the range of $105 million to $115 million, and adjusted basic earnings per share between $2.45 and $2.75. The balance sheet remains strong, with net debt leverage under 2x, and capital expenditures are expected to be approximately $32.5 million for the year. The Branded Spirits segment is anticipated to experience a modest sales decline for the full year, though the premium plus segment is expected to grow by low single-digits.MGP Ingredients Financial Statement Overview
Summary
MGP Ingredients demonstrates robust cash flow and a stable balance sheet with a strong equity base. However, declines in revenue and net income margins indicate challenges in maintaining profitability.Income Statement
MGP Ingredients has shown a decrease in revenue over the TTM period compared to the previous year, with a negative revenue growth rate of approximately -6.95%. However, the company maintains a healthy gross profit margin of 40.75% and a moderate EBIT margin of 7.66%. The net profit margin has decreased significantly to 1.64%, indicating potential challenges in net profitability.65
Positive
Balance Sheet
The balance sheet reflects a stable financial structure with an equity ratio of 60.12%, suggesting a solid equity base. The debt-to-equity ratio is 0.37, showing moderate leverage. However, the return on equity (ROE) has decreased to 1.30%, indicating reduced efficiency in generating returns on equity capital.70
Positive
Cash Flow
Operating cash flow remains strong at $122.34 million, with a significant free cash flow of $58.26 million, demonstrating robust cash generation capabilities. The operating cash flow to net income ratio is high at 11.39, indicating efficient cash flow management despite the lower net income.75
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 654.72M | 703.63M | 836.52M | 782.36M | 626.72M | 395.52M |
| Gross Profit | 266.85M | 286.32M | 304.71M | 253.31M | 198.97M | 98.81M |
| EBITDA | 68.46M | 98.87M | 170.51M | 167.08M | 117.00M | 67.20M |
| Net Income | 10.75M | 34.66M | 107.47M | 109.46M | 91.31M | 40.34M |
Balance Sheet | ||||||
| Total Assets | 1.38B | 1.41B | 1.39B | 1.16B | 1.04B | 366.57M |
| Cash, Cash Equivalents and Short-Term Investments | 20.11M | 25.27M | 18.39M | 47.89M | 21.57M | 21.66M |
| Total Debt | 309.86M | 339.64M | 301.86M | 241.96M | 240.40M | 42.93M |
| Total Liabilities | 551.51M | 573.24M | 543.28M | 412.57M | 397.20M | 104.05M |
| Stockholders Equity | 828.35M | 834.17M | 850.49M | 745.64M | 644.26M | 262.53M |
Cash Flow | ||||||
| Free Cash Flow | 58.26M | 31.10M | 28.52M | 43.61M | 40.87M | 33.55M |
| Operating Cash Flow | 122.34M | 102.28M | 83.78M | 88.94M | 88.26M | 53.26M |
| Investing Cash Flow | -64.22M | -71.56M | -159.24M | -47.81M | -182.62M | -19.65M |
| Financing Cash Flow | -57.78M | -23.80M | 45.92M | -14.76M | 94.29M | -15.26M |
MGP Ingredients Technical Analysis
Negative
29.19
Price Trends
29.74
Negative
29.79
Negative
33.07
Negative
Market Momentum
<0.01
Negative
49.76
Neutral
41.35
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MGPI, the sentiment is Negative. The current price of 29.19 is above the 20-day moving average (MA) of 28.73, below the 50-day MA of 29.74, and below the 200-day MA of 33.07, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 49.76 is Neutral, neither overbought nor oversold. The STOCH value of 41.35 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MGPI.
MGP Ingredients Risk Analysis
MGP Ingredients disclosed 33 risk factors in its most recent earnings report. MGP Ingredients 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
MGP Ingredients Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $14.22B | 16.58 | 22.65% | 3.06% | -3.34% | -14.19% | |
68 Neutral | $60.61B | 26.00 | 22.33% | 3.76% | 0.22% | -38.76% | |
68 Neutral | $14.22B | 16.33 | 22.65% | 3.21% | -3.34% | -14.19% | |
64 Neutral | $624.09M | 67.36 | -0.76% | 1.64% | -22.65% | -107.16% | |
63 Neutral | $20.42B | 14.64 | -2.96% | 3.11% | 2.04% | -6.12% | |
60 Neutral | $26.67B | 49.10 | -5.05% | 2.77% | -0.47% | -117.62% | |
47 Neutral | $30.98M | ― | -23.93% | ― | -24.81% | 80.45% |
* Consumer Defensive Sector Average
Performance Comparison
MGPI
MGP Ingredients
29.19
-57.48
-66.32%
BF.A
Brown Forman A
28.52
-15.38
-35.03%
STZ
Constellation Brands
146.49
-96.53
-39.72%
DEO
Diageo
110.02
-16.73
-13.20%
BF.B
Brown-Forman B
28.20
-15.80
-35.91%
BLNE
Eastside Distilling
1.61
-12.79
-88.82%
MGP Ingredients Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
MGP Ingredients Appoints Julie Francis as New CEO
Positive
Jul 21, 2025
On July 21, 2025, MGP Ingredients announced the appointment of Julie Francis as President and CEO, succeeding Brandon Gall, who will continue as CFO. Francis, with extensive leadership experience in the food and beverage industry, is expected to drive growth and value creation for MGP, aligning with the company’s vision of becoming a premier branded spirits company. The company reaffirmed its financial outlook for 2025, indicating confidence in its strategic direction and operational stability.
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.