BellRing Brands is IBD Stock of the Day as it pops back into the buy zone two days after posting an earnings beat-and-raise report.
Its latest breakout follows a strong run. BRBR stock is up nearly 6% in this young year after almost doubling (up 95.6%) in 2023. On Wednesday, BellRing stock hit an all-time high, near 59.
The consumer staples company provides ready-to-drink protein shakes and powders. Its primary brands include Premier Protein and Dymatize. Sales for both are growing in double digits.
Companies like BellRing and Medifast tap the rising market for wellness and sports nutrition products.
BRBR Stock Breaks Out
BellRing Brands combines the defensive appeal of consumer staples stocks with solid growth prospects.
On Monday, shares of BellRing Brands topped a 57 buy point from a flat base, the MarketSmith chart shows. BellRing stock climbed back into buy range on the stock market today, after a quick dip to test short-term support.
The seven-week flat base formed entirely above the 10-week moving average, a sign of investor support. Further to that, the relative strength line for BellRing stock is rising, a sign of outperformance vs. the S&P 500 index.
However, the RS line remains slightly below the consolidation peak. It would be a bullish sign if that key strength indicator were to make a new high as the stock offers a fresh buying opportunity.
BRBR stock holds a superior RS Rating of 95. That means it has outperformed 95% of all stocks in IBD's database over the past year.
BellRing Brands Earnings Power Up
For the fiscal first quarter ending December, BellRing posted earnings of 43 cents, a 30.3% increase year over year, on net sales of $430.4 million, an 18.7% increase. Both beat Wall Street's estimates.
Citing higher demand and capacity expansion, the protein drink maker hiked its 2024 earnings outlook to $375 million-$400 million, from $360 million-$390 million.
"Our strong start to 2024 gives us greater confidence in the full year and drives our decision to raise our outlook," BellRing CEO Darcy Davenport said in the quarterly earnings release.
Nine analysts hiked price targets on BRBR stock after the earnings report. One firm cut its price target, FactSet shows.
For the full year, Wall Street forecasts BellRing earnings growth will accelerate to 25.3% from 13.8% in fiscal 2023. Sales growth is seen slowing to a still-solid 14.9% from 21.9% over the same period.
The global ready-to-drink protein drinks market is expected to reach $1.68 billion in 2024, growing 7.72% annually to reach $2.43 billion by 2029, according to some estimates.
