Nomad Foods (NOMD) AI Stock Analysis

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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)

Market Cap

$2.70B

Dividend Yield3.52%

Average Volume (3M)969.15K

Price to Earnings (P/E)11.6

Beta (1Y)0.19

Revenue Growth-0.24%

EPS Growth26.74%

CountryUS

Employees6,864

SectorConsumer Defensive

Sector Strength79

IndustryPackaged Foods

Share Statistics

EPS (TTM)0.40

Shares Outstanding153,402,980

10 Day Avg. Volume1,076,403

30 Day Avg. Volume969,154

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)0.96

Price to Sales (P/S)0.00

P/FCF Ratio8.12

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$24.75

Price Target Upside41.43% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering4

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

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

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

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.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
3.08B	3.10B	3.04B	2.94B	2.61B	2.52B
	Gross Profit
918.50M	917.80M	858.70M	815.30M	744.30M	762.50M
	EBIT
388.80M	387.00M	408.30M	375.40M	342.70M	359.20M
	EBITDA
503.40M	505.10M	480.50M	492.20M	459.70M	429.80M
	Net Income Common Stockholders
225.30M	227.10M	192.70M	249.80M	181.00M	225.20M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
329.80M	403.00M	412.70M	369.70M	254.20M	418.20M
	Total Assets
6.40B	6.43B	6.42B	6.33B	6.17B	5.57B
	Total Debt
2.15B	2.18B	2.15B	2.16B	2.23B	1.76B
	Net Debt
1.82B	1.77B	1.74B	1.80B	1.97B	1.37B
	Total Liabilities
3.79B	3.77B	3.82B	3.72B	3.87B	3.45B
	Stockholders Equity
2.61B	2.66B	2.59B	2.61B	2.30B	2.13B
Cash Flow		Free Cash Flow
306.80M	355.10M	348.40M	224.70M	227.10M	398.30M
	Operating Cash Flow
387.00M	435.40M	430.80M	303.80M	306.30M	457.00M
	Investing Cash Flow
-65.10M	-64.40M	-76.80M	-78.70M	-660.00M	-171.40M
	Financing Cash Flow
-389.40M	-366.40M	-321.50M	-108.10M	214.40M	-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
SMPL	76 Outperform	$3.48B	24.00	8.40%	―	11.47%	2.59%
CAG	68 Neutral	$10.69B	32.78	3.67%	6.25%	-3.15%	-65.38%
POST	67 Neutral	$6.02B	19.48	9.15%	―	1.48%	9.36%
NOMD	66 Neutral	$2.70B	11.61	8.59%	3.52%	-0.24%	26.74%
Sector *	65 Neutral	$8.84B	14.90	4.69%	203.33%	3.49%	-1.84%
JJSF	58 Neutral	$2.17B	28.63	8.20%	2.76%	0.49%	-12.32%
KLG	54 Neutral	$1.49B	26.81	17.70%	3.75%	-3.13%	-51.40%

* Consumer Defensive Sector Average

Performance Comparison

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.