Freshpet is Thursday's pick for IBD 50 Growth Stocks To Watch, as the pet food maker currently sits in a base and is back above a closely watched moving average. Estimates call for Freshpet stock to show a profit for fiscal 2024, after years of losses.
The IBD 50 stock ranks No. 1 out of 33 in the Packaged Food group, which recently sank to the No. 140 spot out of the 197 industry groups IBD tracks.
The stock climbed Thursday, adding to three straight days of gains, as it reclaimed its 10-week moving average. Freshpet shares have gained 4% so far in January, after climbing 76% in 2024.
Freshpet Stock Sets Up For Next Move
The premium pet food company makes refrigerated dog and cat food, available in select grocery and pet stores, as well as club retailers across the U.S., Canada, Europe and online. Freshpet boasts it uses locally sourced natural ingredients when possible.
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Shares are in a flat base with a 160.91 buy point, according to MarketSurge pattern recognition. The buy point is also its 52-week high. Freshpet stock is nearing a level not seen since November 2021.
Freshpet stock soared 12.6% in heavy volume following the company's better-than-expected earnings and sales report for the third quarter on Nov. 4. The stock holds a 90 Relative Strength Rating.
Freshpet Dog Food Profit Estimates Pop
Freshpet reported a 24 cents per-share profit in its third quarter, compared with a loss of 15 cents a share during the same period in 2023.
The dog food maker raised its full-year 2024 net sales outlook in its third-quarter earnings report to around $975 million from its previous outlook of $965 million.
Its third-quarter gross margin grew to 40.4% from 33% in the prior year's same quarter.
Projections call for a 91-cent-per-share profit for 2024, after a loss of 62 cents a share in 2023, then a hearty $1.52-per-share profit in 2025.
Sales Growth Results, Projections
Its quarterly sales have grown steadily with an average 29% over the last seven quarters. Forecasts show revenue growing an average 24% over the next four quarters.
Mutual funds own 70% of shares and have added the dog food stock for six straight quarters, with 618 owning shares in December, up from 612 in September and 583 in June.
Four IBD Mutual Fund Index high-performing names own Freshpet stock, including Lord Abbett Developing Growth Fund.
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