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1. Company Snapshot

1.a. Company Description

The Simply Good Foods Company operates as a consumer packaged food and beverage company in North America and internationally.The company develops, markets, and sells snacks and meal replacements.It offers protein bars, ready-to-drink shakes, sweet and salty snacks, cookies, pizza, protein chips, recipes, and confectionery products, as well as licensed frozen meals under the Atkins, Atkins Endulge, and Quest brand names.


The company distributes its products to various retail channels, such as mass merchandise, grocery and drug channels, club stores, convenience stores, gas stations, and other channels.It also sells its products through e-commerce channels, including atkins.com, questnutrition.com, and amazon.com.The Simply Good Foods Company is headquartered in Denver, Colorado.

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1.b. Last Insights on SMPL

Breaking News: Simply Good Foods Company recently caught attention due to a hammer chart pattern formation indicating found support after losing value. The pattern coupled with upward trend in earnings estimate revisions suggests a potential trend reversal. Earnings estimate revisions are trending upward. A recent analysis suggests buying the stock now. Simply Good Foods has a supportive technical setup. The stock could see a turnaround. Recommendation to buy is given by an analyst at this point in time based on recent developments.

1.c. Company Highlights

2. Simply Good Foods Co. Delivers Mixed Q1 Results Amidst Brand Variability

Simply Good Foods Co. reported net sales of $340.2 million for the first quarter of fiscal year 2026, largely flat compared to the prior year. The company's gross profit declined 15.8% to $109.9 million, with a gross margin of 32.3% on a GAAP basis, down 590 basis points year-over-year. Adjusted EBITDA was $55.6 million, down 20.6%, and diluted earnings per share came in at $0.26. The actual EPS was $0.39, beating estimates of $0.36.

Publication Date: Jan -09

📋 Highlights
  • Flat Net Sales: Total net sales remained at $340.2 million YoY, with Quest growing 10% and Atkins declining 17%.
  • Gross Profit Decline: Gross profit fell 15.8% to $109.9 million, with a 590 bps drop in gross margin to 32.3%.
  • Aggressive Share Buybacks: $150 million borrowed to repurchase 7% of stock, with a $200 million increase in repurchase authorization.
  • Full-Year Outlook: Net sales growth -2% to 2%, adjusted EBITDA -4% to 1%, and gross margin decline of 100-150 bps.
  • Second-Half Recovery: Q4 profit growth expected to rise double digits YoY, driven by pricing, productivity, and cocoa benefits.

Segment Performance

Quest net sales grew nearly 10%, driven by 12% consumption growth, while Atkins and OWYN declined 17% and 3%, respectively. Atkins' business has 75% of sales from SKUs in the top half of category velocity, and the company is working to replace slower-moving SKUs with faster-turning ones from Quest and OWYN. Quest Salty had a strong quarter, with 40% growth driven by innovation, new distribution, and merchandising gains.

Outlook and Guidance

The company reaffirmed its full-year outlook, expecting net sales growth between -2% to 2%, with growth from Quest and OWYN offset by Atkins. Gross margins are expected to decline by 100-150 basis points, and adjusted EBITDA year-over-year is expected to be between -4% to 1%. The company expects Q2 net sales to decline 3.5-4.5%, but growth is expected to improve meaningfully in the second half.

Valuation and Share Buyback

The company's stock is currently trading at a P/E Ratio of 22.47 and an EV/EBITDA of 12.07. With its stock at attractive levels, the company borrowed an incremental $150 million to accelerate its share buyback program, repurchasing over 7% of its common stock since the start of the year. The Board authorized a $200 million increase to the existing share repurchase program, indicating the company's confidence in its long-term algorithm and its view that the stock is undervalued.

Growth Prospects and M&A

Analysts estimate next year's revenue growth at 4.3%. The company is confident in its long-term growth prospects, driven by its brands' differentiated positions in the RTD category. M&A is still a consideration, but the company is currently focused on share buybacks. The company's pipeline of new products, including innovations in OWYN and Quest, is expected to contribute to growth in fiscal '26.

3. NewsRoom

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Simply Good Foods (SMPL) Could Find a Support Soon, Here's Why You Should Buy the Stock Now

Feb -02

Source: zacks.com

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The Simply Good Foods Company Reports CEO Inducement Grant Under Nasdaq Listing Rule 5635(c)(4)

Jan -23

Source: globenewswire.com

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Simply Good Foods Appoints Joe Scalzo as President and Chief Executive Officer

Jan -20

Source: globenewswire.com

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SG Americas Securities LLC Acquires 31,299 Shares of The Simply Good Foods Company $SMPL

Jan -20

Source: defenseworld.net

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The Simply Good Foods Company (NASDAQ:SMPL) Given Consensus Recommendation of “Hold” by Brokerages

Jan -16

Source: defenseworld.net

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Wall Street Analysts Believe Simply Good Foods (SMPL) Could Rally 36.41%: Here's is How to Trade

Jan -14

Source: zacks.com

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Simply Good Foods Buybacks Don't Make Up For Weaker Margins

Jan -14

Source: seekingalpha.com

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SMPL Stock Jumps 7% After Posting Earnings & Sales Beat in Q1

Jan -09

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.64%)

6. Segments

Quest

Expected Growth: 6.5%

Quest's 6.5% growth is driven by increasing demand for healthy and convenient food options, strategic partnerships with major retailers, and successful product innovation. Additionally, the company's focus on e-commerce and digital marketing has expanded its customer base, while cost savings initiatives have improved operational efficiency.

Atkins

Expected Growth: 6.8%

Atkins' 6.8% growth is driven by increasing demand for low-carb and keto diets, strategic product innovation, and expanding distribution channels. The brand's strong online presence and influencer partnerships also contribute to its growth. Additionally, The Simply Good Foods Company's focus on acquisitions and partnerships has enhanced Atkins' market reach and product offerings.

7. Detailed Products

Quest Nutrition Products

Quest Nutrition is a leading brand of protein powders, bars, and other nutritional supplements

Atkins Nutritionals Products

Atkins is a well-known brand of low-carb and keto-friendly food products, including snacks, meals, and treats

Simply GoodFats Products

Simply GoodFats is a brand of healthy fats and snacks, including nut butters, seed butters, and other healthy snack options

8. The Simply Good Foods Company's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for The Simply Good Foods Company is medium because while there are some substitutes available, they are not a significant threat to the company's market share.

Bargaining Power Of Customers

The bargaining power of customers for The Simply Good Foods Company is low because the company's products are niche and have a loyal customer base, giving customers limited bargaining power.

Bargaining Power Of Suppliers

The bargaining power of suppliers for The Simply Good Foods Company is medium because while the company relies on a few key suppliers, it also has some flexibility to switch suppliers if needed.

Threat Of New Entrants

The threat of new entrants for The Simply Good Foods Company is high because the healthy food industry is growing rapidly and attracting new entrants, increasing competition.

Intensity Of Rivalry

The intensity of rivalry for The Simply Good Foods Company is high because the healthy food industry is highly competitive, with many established players and new entrants vying for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 15.55%
Debt Cost 7.19%
Equity Weight 84.45%
Equity Cost 7.19%
WACC 7.19%
Leverage 18.42%

11. Quality Control: The Simply Good Foods Company passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Lancaster Colony

A-Score: 5.3/10

Value: 3.5

Growth: 5.9

Quality: 7.5

Yield: 4.0

Momentum: 4.5

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
McCormick

A-Score: 5.2/10

Value: 3.1

Growth: 4.2

Quality: 6.2

Yield: 5.0

Momentum: 3.5

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
J&J Snack Foods

A-Score: 5.0/10

Value: 4.4

Growth: 5.9

Quality: 5.6

Yield: 5.0

Momentum: 0.5

Volatility: 8.3

1-Year Total Return ->

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Stock-Card
Hormel Foods

A-Score: 4.8/10

Value: 4.8

Growth: 2.7

Quality: 4.7

Yield: 7.0

Momentum: 1.0

Volatility: 8.3

1-Year Total Return ->

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Stock-Card
Simply Good Foods

A-Score: 4.3/10

Value: 5.8

Growth: 5.6

Quality: 6.8

Yield: 0.0

Momentum: 0.5

Volatility: 7.0

1-Year Total Return ->

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Stock-Card
BellRing Brands

A-Score: 3.6/10

Value: 6.2

Growth: 6.2

Quality: 6.0

Yield: 0.0

Momentum: 0.0

Volatility: 3.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

17.08$

Current Price

17.08$

Potential

-0.00%

Expected Cash-Flows