Freshpet sags after TD Cowen downgrades on slowing growth profile

Freshpet

28/05/2025 14:57

** Freshpet's FRPT.O shares down 4% at $79.74 early Weds after TD Cowen downgrades pet food maker to 'hold' from 'buy' on concerns about decelerating sales growth trends

** FRPT shares on course to fall for fifth straight session

** Brokerage cuts PT by $5 to $91 vs Wall Street median $117.50, per LSEG data

** FRPT's refrigerated fresh dog food concept nearing a "saturation point" sooner than expected, TD Cowen says in note

** TD Cowen analysts say their Nielsen data shows last 4-week sales growth decelerated to +12%, down from +14% and +21% in last 12-week and last 52-week periods, respectively

** Household penetration growth slowed to 13% in Q1 2025 from 18% in 2024, they say

** TD Cowen also points to activist investor Jana Partners disclosing 1.5% stake in FRPT earlier this month, saying Jana may still believe co should sell itself, but the analysts say they don't see a bid from a strategic acquirer materializing near term

** In Aug, Jana revealed it liquidated a previous position in FRPT where it pushed for changes and reached a settlement a year earlier

** With move on Weds, FRPT shares down 46% YTD vs ~0.5% fall in Nasdaq .IXIC

 (Lance Tupper is a Reuters market analyst. The views expressed are his own)

 ((lance.tupper@tr.com 1-646-279-6380))