Post Holdings shares have risen 36% in the past year, driven by its pivot to pet food and non-cyclical business appeal. Recent results show strong performance with $1.54 EPS, beating estimates by $0.32, and adjusted EBITDA rising 3.5% to $350 million, aided by margin expansion. Despite limited margin expansion ahead, Post's substantial free cash flow and strategic buybacks support my bullish outlook with potential 20% upside.
Post Holdings has aggressively grown through acquisitions and higher pricing, boosting revenue from $4.98 billion in 2021 to $6.99 billion in 2022, with continued growth in 2024. Despite high leverage, Post Holdings trades at low multiples, presenting a compelling investment opportunity with significant upside potential compared to peers. Management's focus on debt reduction and steady EBITDA growth is expected to improve the company's financial health, enhancing shareholder value over time.
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POST has been benefiting from carryover pricing and operational efficiencies while navigating a challenging macroeconomic environment.
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Investors continue to face uncertainty, as ambiguous economic data and a disinverting yield curve hint at a possible recession. Defensive sectors like healthcare and consumer staples tend to outperform during economic downturns, as they provide essential goods and services with inelastic demand, making them more resilient to market fluctuations. SA Quant has identified two stocks with solid investment fundamentals in defensive sectors, with the potential to help investors' portfolio positioning in the event of economic decline.
POST is capitalizing on strategic acquisitions, effective pricing and a strong brand presence despite heightened competition in the staples sector.
Post Holdings is benefiting from strategic acquisitions, effective cost management and solid operational performance, despite tough market conditions.
Post Holdings, Inc. (NYSE:POST ) Q2 2024 Earnings Conference Call August 2, 2024 9:00 AM ET Company Participants Daniel O'Rourke - Investor Relations Robert Vitale - President and Chief Executive Officer Jeff Zadoks - Executive Vice President and Chief Operating Officer Matt Mainer - Senior Vice President, Chief Financial Officer and Treasurer Conference Call Participants Andrew Lazar - Barclays David Palmer - Evercore ISI Kenneth Goldman - JPMorgan Matthew Smith - Stifel Michael Lavery - Piper Sandler John Baumgartner - Mizuho Securities Robert Dickerson - Jefferies Marc Torrente - Wells Fargo Securities Carla Casella - JP Morgan Operator Welcome to the Post Holdings Third Quarter 2024 Earnings Conference Call and Webcast. [Operator Instructions] I would now like to turn the call over to Daniel O'Rourke, Investor Relations for Post.
Post Holdings (POST) fiscal third-quarter results reflect sales growth in Post Consumer Brands and Weetabix, counterbalanced by declines in the Foodservice and Refrigerated Retail segments.
The headline numbers for Post Holdings (POST) give insight into how the company performed in the quarter ended June 2024, but it may be worthwhile to compare some of its key metrics to Wall Street estimates and the year-ago actuals.
Post Holdings (POST) came out with quarterly earnings of $1.54 per share, beating the Zacks Consensus Estimate of $1.21 per share. This compares to earnings of $1.52 per share a year ago.