tiprankstipranks
Trending News
More News >
Nomad Foods Ltd (NOMD)
NYSE:NOMD

Nomad Foods (NOMD) AI Stock Analysis

Compare
467 Followers

Top Page

NO

Nomad Foods

(NYSE:NOMD)

Rating:66Neutral
Price Target:
$19.50
▲(11.43%Upside)
Nomad Foods' overall stock score reflects its strong profitability and efficient cash flow management, tempered by challenges in revenue growth and high debt reliance. The technical analysis suggests potential short-term weaknesses, but the valuation remains attractive with a reasonable P/E ratio and robust dividend yield. The mixed earnings call highlights market pressures that could impact future performance.
Positive Factors
Product Innovation
A sharp ramp in product renovation and innovation along with early market share successes in 'Lift & Launch' distribution expansion provide material support for adjacent product introductions.
Productivity and Efficiency
Q4's solid EBITDA beat was supported by a ramp in productivity and consistent with the thesis that efficiencies are an overlooked support for multi-year EBITDA growth.
Negative Factors
Consumer Demand
The consumer demand environment remains worse than before the inflation super-cycle, despite signs of slow improvement.
Volume Trends
The weaker volume trends and higher inflation outlook led management to trim full-year guidance to 0%-2% organic revenue and adjusted EBITDA growth.

Nomad Foods (NOMD) vs. SPDR S&P 500 ETF (SPY)

Nomad Foods Business Overview & Revenue Model

Company DescriptionNomad Foods (NOMD) is a leading frozen foods company operating primarily in Europe. The company is known for its portfolio of well-established brands such as Birds Eye, Findus, and Iglo. Nomad Foods focuses on producing a wide range of frozen food products including fish, vegetables, ready meals, and poultry, aiming to provide consumers with convenient, nutritious, and high-quality meal solutions.
How the Company Makes MoneyNomad Foods generates revenue primarily through the sale of its frozen food products to retail customers across Europe. The company's key revenue streams include branded products sold under its marquee brands like Birds Eye, Findus, and Iglo. Nomad Foods leverages a robust distribution network to supply its products to supermarkets, hypermarkets, and other retail channels. The company may also engage in strategic partnerships with retailers and distributors to expand its market reach and enhance product visibility. Additionally, Nomad Foods focuses on innovation and product development to meet consumer demands and maintain a competitive edge in the frozen foods market.

Nomad Foods Earnings Call Summary

Earnings Call Date:May 08, 2025
(Q1-2025)
|
% Change Since: -7.70%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a mix of positive and negative aspects. While the company has shown resilience and delivered significant shareholder returns, it faces challenges with retail inventory destocking, increased input costs, and market share pressures, leading to adjusted guidance for 2025.
Q1-2025 Updates
Positive Updates
Resilient Organization and Market Position
Nomad Foods has built a resilient organization with a strong portfolio and leading brands. Retail sell-through rose modestly, in line with expectations, and the company achieved gross margin expansion. Strong cash flow allowed for significant shareholder returns.
Significant Shareholder Returns
Nomad Foods returned EUR 74 million to shareholders in Q1 2025, marking a 152% increase from Q1 2024. This was achieved through EUR 49 million in share repurchases and EUR 25 million in dividends.
Successful Growth Platforms
Net sales for growth platforms rose 36% year-over-year in Q1 2025. The company achieved a nearly 2% share in the frozen chip market in the U.K. and doubled retail sales of prepared meals in Germany.
Negative Updates
Retail Inventory Destocking Impact
Nomad Foods experienced greater-than-expected retail inventory destocking across Europe, causing net sales to lag sell-through by a larger-than-expected amount in Q1 2025.
Increased Input Costs and Adjusted Guidance
The company's input cost outlook has increased modestly, leading to a lowered full-year guidance for organic revenue, adjusted EBITDA, and adjusted EPS growth ranges for 2025.
Category and Market Share Challenges
Market share gains stalled in Q1 2025, with some softness in the U.K. market and challenges from tough comparisons due to industry-wide promotion activity reductions and consumer down trading.
Company Guidance
In the first quarter of 2025, Nomad Foods reported a modest increase in retail sell-through, aligning with their expectations due to the timing of growth initiatives and a later Easter. Despite a 3% decline in reported net revenues to EUR 760 million, the company achieved a 90 basis point gross margin expansion to 27.8%, supported by supply chain productivity savings and overhead cost efficiencies. They returned EUR 74 million to shareholders, marking a 152% increase from the previous year, through share repurchases and dividends. However, Nomad faced greater-than-anticipated retail inventory destocking in Europe, leading to a 3.6% organic sales decline. This, alongside increased input costs, prompted a downward revision of their full-year guidance, with projected 0% to 2% organic revenue growth and adjusted EBITDA growth. Despite these challenges, Nomad continues to invest in brand and product development, maintaining a long-term focus on business health.

Nomad Foods Financial Statement Overview

Summary
Nomad Foods has a strong profitability profile with solid EBITDA margins, although revenue growth has recently declined. The company has a moderate balance sheet with a notable reliance on debt financing, which could pose risks. Cash flow remains healthy, but there's been a decline in free cash flow compared to the previous year.
Income Statement
72
Positive
Nomad Foods exhibits strong profitability with consistent gross profit and EBIT margins over recent periods. The gross profit margin for the TTM is approximately 29.9%, and the net profit margin stands at 7.3%. However, the revenue growth rate shows a slight decline recently, indicating potential challenges in increasing sales. Despite this, the solid EBITDA margin of 16.4% suggests efficient operational management.
Balance Sheet
65
Positive
The company's balance sheet demonstrates moderate financial stability. The debt-to-equity ratio is about 0.82, suggesting a balanced capital structure, though slightly high for industry standards. Return on equity is solid at 8.6%, reflecting good profitability relative to shareholder equity. However, the equity ratio is 40.8%, indicating a substantial reliance on debt financing, which could pose risks if not managed carefully.
Cash Flow
68
Positive
Nomad Foods shows a healthy cash flow position with a free cash flow of approximately 306.8 million USD for the TTM. The operating cash flow to net income ratio is robust at 1.72, indicating strong cash generation relative to earnings. However, the free cash flow has declined compared to the previous year, suggesting some challenges in maintaining cash flow growth.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
3.08B3.10B3.04B2.94B2.61B2.52B
Gross Profit
918.50M917.80M858.70M815.30M744.30M762.50M
EBIT
388.80M387.00M408.30M375.40M342.70M359.20M
EBITDA
503.40M505.10M480.50M492.20M459.70M429.80M
Net Income Common Stockholders
225.30M227.10M192.70M249.80M181.00M225.20M
Balance SheetCash, Cash Equivalents and Short-Term Investments
329.80M403.00M412.70M369.70M254.20M418.20M
Total Assets
6.40B6.43B6.42B6.33B6.17B5.57B
Total Debt
2.15B2.18B2.15B2.16B2.23B1.76B
Net Debt
1.82B1.77B1.74B1.80B1.97B1.37B
Total Liabilities
3.79B3.77B3.82B3.72B3.87B3.45B
Stockholders Equity
2.61B2.66B2.59B2.61B2.30B2.13B
Cash FlowFree Cash Flow
306.80M355.10M348.40M224.70M227.10M398.30M
Operating Cash Flow
387.00M435.40M430.80M303.80M306.30M457.00M
Investing Cash Flow
-65.10M-64.40M-76.80M-78.70M-660.00M-171.40M
Financing Cash Flow
-389.40M-366.40M-321.50M-108.10M214.40M-714.80M

Nomad Foods Technical Analysis

Technical Analysis Sentiment
Negative
Last Price17.50
Price Trends
50DMA
19.01
Negative
100DMA
18.36
Negative
200DMA
17.97
Negative
Market Momentum
MACD
-0.43
Positive
RSI
31.63
Neutral
STOCH
10.05
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NOMD, the sentiment is Negative. The current price of 17.5 is below the 20-day moving average (MA) of 18.64, below the 50-day MA of 19.01, and below the 200-day MA of 17.97, indicating a bearish trend. The MACD of -0.43 indicates Positive momentum. The RSI at 31.63 is Neutral, neither overbought nor oversold. The STOCH value of 10.05 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NOMD.

Nomad Foods Risk Analysis

Nomad Foods disclosed 60 risk factors in its most recent earnings report. Nomad Foods 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

Nomad Foods Peers Comparison

Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
76
Outperform
$3.48B24.008.40%11.47%2.59%
CACAG
68
Neutral
$10.69B32.783.67%6.25%-3.15%-65.38%
67
Neutral
$6.02B19.489.15%1.48%9.36%
66
Neutral
$2.70B11.618.59%3.52%-0.24%26.74%
65
Neutral
$8.84B14.904.69%203.33%3.49%-1.84%
58
Neutral
$2.17B28.638.20%2.76%0.49%-12.32%
KLKLG
54
Neutral
$1.49B26.8117.70%3.75%-3.13%-51.40%
* Consumer Defensive Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
NOMD
Nomad Foods
17.50
0.28
1.63%
CAG
Conagra Brands
22.90
-5.33
-18.88%
JJSF
J & J Snack Foods
113.51
-45.09
-28.43%
SMPL
Simply Good Foods
34.90
-2.06
-5.57%
POST
Post Holdings
109.80
4.66
4.43%
KLG
WK Kellogg Co
17.29
-1.35
-7.24%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.