BellRing Brands Downgraded After 25% EBITDA Guidance Cut, Shares Plunge 38.8%
BellRing Brands reported Q2 adjusted EBITDA guidance of $315-$335 million, a 25% cut from $425-$440 million, and trimmed its net sales growth outlook to flat-2% from 4-6%, driving shares down 38.8% to a record $10.63. Morgan Stanley, Bernstein and Bank of America each downgraded the stock and slashed price targets.
1. Q2 Results and Guidance Cuts
BellRing Brands reported second-quarter adjusted EBITDA guidance of $315-$335 million, down roughly 25% from the prior $425-$440 million range. Management also trimmed full-year net sales growth outlook to flat-plus-2% from an earlier 4-plus-6% forecast, citing heightened consumer price sensitivity, promotional intensity and cost inflation.
2. Analyst Downgrades and Price Target Revisions
Morgan Stanley lowered its rating to Equal-Weight and cut its target to $13 from $24, Bernstein moved to Market-Perform with an $11 objective (down from $35), and Bank of America shifted to Underperform with a $10 target (from $19). These actions reflect concerns over a broadening headwind environment affecting margins and demand.
3. Market Reaction and Outlook
Shares tumbled 38.8% to a record closing low of $10.63, hitting $9.22 intraday and extending losses in premarket trade. Persistent promotional activity, declining ready-to-drink shake buy rates and rising input costs suggest the stock may remain under pressure until evidence of stabilization emerges.