Why the Freshpet stock was slipping today
Actions of Freshpet (NASDAQ: FRPT) were pulling out after the fresh and chilled pet food maker slashed its annual forecast for supply chain issues.
As a result, the stock closed down 3.2%.
Image source: Getty Images.
In an update this morning, Freshpet said it now expects annual revenue of $ 425 million to $ 430 million, down from a previous target of $ 445 million. He also guided adjusted EBITDA to $ 42 million, down from previous guidance of $ 50 million.
In a statement, CEO Billy Cyr said, “Supply chain issues continue to pose new challenges for our business, this time with parts supplies for key packaging components. which in turn results in the revision of our expectations for the full year which we are updating today. “
Cyr also added that the company’s key metrics are improving as the new year approaches, a positive sign for 2022.
Freshpet shares fell as much as 12% this morning, but slowly recouped most of their losses as some investors seemed to believe the sell off, which took the stock to its lowest level in 52 weeks, was an opportunity to purchase, especially since the supply chain challenges are short-term in nature.
An analyst, Mark Astrachan from Stifel, lowered its target for the share price but maintained a buy rating, saying final demand remains strong.
Freshpet has been a big winner in the stock market throughout its history, showing steady growth as a leader in fresh and chilled pet food, and its long-term growth outlook still looks strong as it still has a lot of market to enter. Considering this, today’s sale appears to provide a good buying opportunity for the pet stock.
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Jeremy Bowman has no position in the stocks mentioned. The Motley Fool owns and recommends Freshpet. The Motley Fool has a disclosure policy.
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