Expanding Retail Access And RTD Shakes Will Open Future Markets

Key Takeaways

• Category leadership and expanded retail presence drive sustained revenue growth and margin gains through greater scale and distribution.
  
• Innovation, supply chain optimization, and targeted marketing strengthen brand equity, address evolving consumer trends, and support long-term earnings growth.
  
• Margin pressure, heavy competition, brand concentration risk, and regulatory threats may limit profit growth and revenue stability despite increased marketing investments.

Catalysts

Provides various nutrition products in the United States.

• Accelerating household penetration and distribution gains in the ready-to-drink (RTD) protein shake category, which still has significant "runway" as only about half of U.S. households currently consume RTDs, with Premier Protein positioned as the category leader-expected to drive sustained topline growth.
  
• Retailers are allocating more shelf space and expanding displays for high-protein, convenient nutrition products, creating a structural tailwind for category expansion and enabling incremental volume and market share gains, directly benefiting revenue growth and gross margin through improved scale.
  
• Expansion into new product formats (single-serve, non-dairy almond milk shakes, indulgence lines) and increased innovation pipelines allow BellRing to address evolving consumer preferences and new consumption occasions, supporting both revenue growth and margin accretion as more premium, differentiated offerings gain traction.
  
• Strategic investments in regional co-manufacturing networks and supply chain optimization have unlocked greater capacity and operational agility, positioning the company to capitalize on upcoming distribution opportunities and deliver enhanced cost efficiencies for improved net margins.
  
• Ongoing investment in brand support, digital marketing, and omnichannel merchandising-especially modernizing packaging and targeting younger consumers-leverages long-term trends in health, wellness, and digital commerce to strengthen brand equity, accelerate household buy rates, and support higher-margin direct-to-consumer channels, driving long-term earnings growth.

BellRing Brands Future Earnings and Revenue Growth

Assumptions

• Analysts are assuming BellRing Brands's revenue will grow by 8.2% annually over the next 3 years.
• Analysts assume that profit margins will increase from 10.3% today to 11.1% in 3 years time.
• Analysts expect earnings to reach $312.5 million (and earnings per share of $2.64) by about August 2028, up from $228.3 million today.
• In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 28.4x on those 2028 earnings, up from 21.5x today. This future PE is greater than the current PE for the US Personal Products industry at 21.0x.
• Analysts expect the number of shares outstanding to decline by 2.52% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 8.11%, as per the Simply Wall St company report.

BellRing Brands Future Earnings Per Share Growth

Risks

• Rising input cost inflation and continued cost headwinds-especially from whey protein and tariffs on imported dairy-are driving down gross margins, with management indicating these will impact results through at least fiscal 2026, threatening sustained margin compression and net earnings growth.
  
• Intensifying competition in the RTD protein shake category, as both large CPG incumbents and new entrants secure additional retail space (particularly in club channels), may require higher promotional spending and could drive increased price competition, pressuring both revenue growth and profitability.
  
• Heavy reliance on Premier Protein as the core brand creates significant concentration risk if demand shifts, market share erodes due to evolving consumer preferences, or future innovation fails to resonate, which could materially impact top-line growth and earnings stability.
  
• Increased promotional and marketing investments necessary to maintain shelf space and consumer engagement in a crowded, innovation-driven market may offset gains in operating leverage, constraining improvements in net margins and profit growth.
  
• Ongoing regulatory threats-including the risk of higher tariffs on key ingredients from New Zealand/EU and the potential for future policy changes targeting nutrition labeling or sugar/protein content-could drive structural increases in costs of goods or restrict product formulations, impacting both gross margin and future revenue potential.

Valuation

• The analysts have a consensus price target of $60.533 for BellRing Brands based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $88.0, and the most bearish reporting a price target of just $40.0.
  
• In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $2.8 billion, earnings will come to $312.5 million, and it would be trading on a PE ratio of 28.4x, assuming you use a discount rate of 8.1%.
  
• Given the current share price of $38.95, the analyst price target of $60.53 is 35.7% higher.
  
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.