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Westrock Coffee Company (WEST)
:WEST
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Westrock Coffee
(NASDAQ:WEST)
Rating:51Neutral
Price Target:
$7.00
▲(5.90%Upside)
Positive Factors
Cost Management
Green coffee commodity inflation appears to have peaked, with recent pricing showing a decrease from the high levels seen earlier, which could positively impact costs.
Production Capabilities
The first high-speed canning line was fully commercialized as scheduled, and a second line is expected to be commercial, indicating strong production capabilities.
Revenue Growth
Westrock Coffee Company reported operating results that beat consensus expectations on both the revenue and AEBITDA lines, driven by strong cross selling activity across multiple product lines.
Negative Factors
Consumer Confidence
The continuing pullback in consumer confidence is likely to have driven end market demand below initial expectations, leading to lower revenue estimates.
Revenue Challenges
Challenges have been recognized regarding the timing of commercialized product revenues from the Conway facility, influenced by customers' contractual obligations with old suppliers and a choppier consumer environment.
Revenue Growth Estimate
A conservative approach is being taken with a reduced year-over-year revenue growth estimate due to declining consumer confidence.
Westrock Coffee (WEST) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$628.42M
Dividend YieldN/A
Average Volume (3M)294.81K
Price to Earnings (P/E)―
Beta (1Y)0.55
Revenue Growth2.38%
EPS Growth-30.88%
CountryUS
Employees1,408
SectorConsumer Defensive
Sector Strength63
IndustryPackaged Foods
Share Statistics
EPS (TTM)-0.22
Shares Outstanding94,641,174
10 Day Avg. Volume269,541
30 Day Avg. Volume294,809
Financial Highlights & Ratios
PEG Ratio-0.14
Price to Book (P/B)69.83
Price to Sales (P/S)0.00
P/FCF Ratio-5.39
Enterprise Value/Market Cap1.35
Enterprise Value/Revenue0.25
Enterprise Value/Gross Profit6.13
Enterprise Value/Ebitda-19.59
Forecast
1Y Price Target
$10.00Price Target Upside51.29% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
Westrock Coffee Business Overview & Revenue Model
Company DescriptionWestrock Coffee Company, LLC roasts, produces, and distributes coffee. It operates through two segments, Beverage Solutions and Sustainable Sourcing and Traceability. The company engages in coffee sourcing, supply chain management, product development, and packaging to the retail, food service and restaurant, convenience store and travel center, non-commercial account, CPG, and hospitality industries. It also offers coffee, tea, juices, flavors, extracts, and ingredients. In addition, the company provides various packaging, including branded and private label coffee in bags, fractional packs, and single serve cups, as well as extract solutions. Further, it engages in delivery and settlement of forward sales contracts for green coffee. The company also exports its products. The company was founded in 2009 and is based in Little Rock, Arkansas.
How the Company Makes MoneyWestrock Coffee generates revenue through multiple streams, primarily focused on the sale of coffee, tea, and extracts. The company sources raw coffee beans directly from farmers and cooperatives, often through sustainable and fair-trade agreements, which are then roasted and processed into a variety of products for different markets. Revenue is generated from both bulk sales to large retailers and foodservice providers, as well as through branded consumer products available in retail outlets. Key partnerships with major retailers and foodservice chains help drive significant sales volume. Additionally, Westrock Coffee offers value-added services such as private label production and beverage product development, further diversifying its revenue streams. The company's commitment to quality and sustainable practices enhances its competitive advantage and supports its market position.
Westrock Coffee Earnings Call Summary
Earnings Call Date:May 08, 2025
(Q1-2025)
| % Change Since: 7.48%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong growth trajectory driven by significant expansion and development in the company's manufacturing capabilities, particularly with the Conway facilities. Despite the net loss and challenges posed by high coffee prices and tariffs, the company maintains a positive outlook supported by robust sales growth and strategic wins in the single-serve cup market.Q1-2025 Updates
Positive Updates
Revenue and EBITDA Growth
Net sales increased by 11.1% compared to the first quarter of 2024. The combination of Beverage Solutions and SS&T segment EBITDAS reached $11.5 million, up 3.3% over the prior year. Adjusted EBITDA for the first half of 2025 is projected to increase by roughly 25% over the prior year, and for the full year 2025 to be up roughly 35% over 2024.
Conway Facilities Launch
Successful commercial launch of two new manufacturing facilities in Conway, Arkansas, including the largest roast-to-extract-to-RTD facility. The facilities are expected to significantly drive performance, with production capacity for hundreds of millions of RTD cans and billions of single-serve cups annually.
Strong Single-Serve Cup Performance
Significant growth in single-serve cup segment, driven by several private label and branded product wins. The company is expanding capacity in response to high demand.
Sustainable Sourcing Segment Growth
The sustainable sourcing traceability segment saw a 44% increase in sales compared to the first quarter of 2024, with segment adjusted EBITDA increasing from $300,000 to $1.9 million.
Negative Updates
Net Loss
The company reported a net loss of $27.2 million for the first quarter of 2025.
Impact of High Coffee Prices and Tariffs
The company continues to contend with historically high green coffee prices and is expecting the impact of recently announced tariffs on coffee costs to begin in the second quarter, which could pressure liquidity.
Conway Scale-Up Costs
Consolidated adjusted EBITDA was burdened by $3.3 million in Conway scale-up operating costs.
Company Guidance
During Westrock Coffee Company's first quarter 2025 earnings call, the company reaffirmed its guidance for both the first half and the entire year of 2025. The combination of the Beverage Solutions and SS&T segment EBITDAS reached $11.5 million, representing a 3.3% increase from the previous year and aligning with the company's expectations of a flat first quarter. For the first half of 2025, the adjusted EBITDA from these segments is expected to range between $27.5 million and $34 million, marking a 25% year-over-year increase. The full-year 2025 adjusted EBITDA guidance is projected to be between $75 million and $88 million, reflecting a 35% rise over 2024. Key drivers for this performance include the commercial launch of two new manufacturing facilities in Conway, Arkansas, which are anticipated to significantly enhance production capabilities. Additionally, the company highlighted successful customer wins and new capacity expansions across facilities, positioning it to capitalize on evolving consumer trends in the coffee and beverage markets.Westrock Coffee Financial Statement Overview
Summary
Westrock Coffee faces significant financial challenges, including weak profitability and cash flow issues. Despite some asset management stability and a slight improvement in the debt-to-equity ratio, operational inefficiencies and poor cash flow management need urgent attention.Income Statement
Westrock Coffee shows weak profitability with negative net income and declining gross profit margins over the past year. The company has experienced a decline in EBIT and EBITDA margins, reflecting operational challenges. Revenue growth is marginal, highlighting limited expansion in the top line.45
Neutral
Balance Sheet
The balance sheet indicates a moderate level of financial stability. The debt-to-equity ratio suggests a high reliance on debt, though improved from prior years. The equity ratio remains relatively low, indicating limited equity financing. There is a moderate return on equity despite negative net income, reflecting potential future improvements.50
Neutral
Cash Flow
Westrock Coffee's cash flow position is concerning, with negative free cash flow and operating cash flow. The operating cash flow to net income ratio is unfavorable, highlighting cash flow inefficiencies. The free cash flow to net income ratio is also negative, suggesting cash flow challenges in supporting operations.40
Negative
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 872.02M | 850.73M | 864.71M | 867.87M | 698.14M | 550.85M | Gross Profit |
| 138.27M | 153.77M | 139.86M | 152.76M | 145.42M | 107.20M | EBIT |
| -53.16M | -49.12M | -20.43M | 23.93M | 16.95M | -8.99M | EBITDA |
| -7.17M | -7.78M | 14.92M | 4.36M | 48.80M | -97.34M | Net Income Common Stockholders |
| -83.84M | -80.30M | -34.58M | -55.46M | -21.31M | -128.87M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 33.05M | 26.15M | 37.20M | 16.84M | 19.34M | 16.89M | Total Assets |
| 1.14B | 1.10B | 971.51M | 744.53M | 593.02M | 548.14M | Total Debt |
| 539.80M | 504.99M | 344.96M | 216.91M | 337.81M | 327.71M | Net Debt |
| 506.75M | 478.84M | 307.12M | 200.07M | 318.46M | 310.82M | Total Liabilities |
| 793.53M | 730.45M | 583.56M | 457.86M | 487.15M | 447.22M | Stockholders Equity |
| 345.18M | 371.33M | 387.96M | 9.27M | -239.71M | -201.75M |
| Cash Flow | Free Cash Flow | ||||
| -175.50M | -172.87M | -228.85M | -120.06M | -22.56M | -32.92M | Operating Cash Flow |
| -43.34M | -13.24M | -64.06M | -56.63M | 2.88M | -13.45M | Investing Cash Flow |
| -117.77M | -145.92M | -168.35M | -74.17M | -22.65M | -411.82M | Financing Cash Flow |
| 191.94M | 156.63M | 244.21M | 134.68M | 23.84M | 442.58M |
Westrock Coffee Technical Analysis
Negative
6.61
Price Trends
6.51
Positive
6.58
Positive
6.74
Negative
Market Momentum
-0.02
Positive
44.34
Neutral
17.45
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WEST, the sentiment is Negative. The current price of 6.61 is below the 20-day moving average (MA) of 6.90, above the 50-day MA of 6.51, and below the 200-day MA of 6.74, indicating a neutral trend. The MACD of -0.02 indicates Positive momentum. The RSI at 44.34 is Neutral, neither overbought nor oversold. The STOCH value of 17.45 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WEST.
Westrock Coffee Risk Analysis
Westrock Coffee disclosed 33 risk factors in its most recent earnings report. Westrock Coffee 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
Westrock Coffee Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $381.30M | 37.20 | 14.73% | ― | 12.84% | -22.88% | |
68 Neutral | $821.90M | 2.94 | -31.74% | ― | -2.45% | 100.59% | |
65 Neutral | $8.77B | 15.11 | 4.67% | 3.71% | 3.60% | -2.96% | |
61 Neutral | $709.96M | ― | -5.95% | ― | 2.44% | 91.41% | |
54 Neutral | $1.04B | 158.96 | 0.43% | ― | -3.37% | -65.26% | |
51 Neutral | $628.42M | ― | -23.58% | ― | 2.38% | -30.88% | |
47 Neutral | $351.91M | ― | -32.48% | 17.23% | -7.06% | -83.82% |
* Consumer Defensive Sector Average
Performance Comparison
WEST
Westrock Coffee
6.61
-3.36
-33.70%
BGS
B&G Foods
4.37
-2.99
-40.63%
HLF
Herbalife
7.89
-3.46
-30.48%
LWAY
Lifeway Foods
24.70
12.26
98.55%
STKL
SunOpta
5.77
0.40
7.45%
THS
TreeHouse Foods
20.16
-16.03
-44.29%
Westrock Coffee Corporate Events
Executive/Board ChangesShareholder Meetings
Westrock Coffee Confirms Board Elections and Auditor
Neutral
Jun 6, 2025
On June 6, 2025, Westrock Coffee Company held its annual meeting of stockholders virtually, where two key proposals were voted on. The election of four Class III directors to the board was confirmed, and PricewaterhouseCoopers LLP was ratified as the independent registered public accountant for the fiscal year ending December 31, 2025.
The most recent analyst rating on (WEST) stock is a Buy with a $10.00 price target. To see the full list of analyst forecasts on Westrock Coffee stock, see the WEST Stock Forecast page.
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.