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These 3 Stocks Offer Investors Exposure to the Functional Beverage BoomBellRing Brands NYSE: BRBR reported third-quarter fiscal 2026 net sales growth that exceeded its expectations, but lowered its profitability outlook as inventory-related charges and higher freight costs weighed on margins.

Net sales increased 4% in the quarter, supported by better-than-expected performance from both the Premier Protein and Dymatize brands. Adjusted EBITDA margins, however, fell below the company’s guidance, prompting BellRing to revise its full-year outlook.

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These 4 Mid-Caps Just Announced Big Buyback PlansMike Axelrod, who joined the company as president and CEO seven days before the call, said the ready-to-drink protein shake category retains favorable long-term fundamentals despite growing competition and recent execution challenges.

“Premier remains the category leader,” Axelrod said. “Consumer trends improved every quarter this year, and we continue to see considerable opportunities to better realize the full potential of the business.”

Third-Quarter Sales Growth and Margin Pressure Trump Tax Reforms: 7 Stocks That Could Benefit in 2025 Premier Protein brand and ready-to-drink shake net sales rose 1% during the quarter. Shake volume increased 3%, while price and mix declined 2%, resulting in a 6% increase in dollar consumption. BellRing said sales growth trailed consumption because of e-commerce promotional timing, the greater effect of promotions on net sales than retail consumption, and modestly lower trade inventory.

Excluding a roughly one-percentage-point benefit from an e-commerce promotional timing shift, consumption outside of club channels grew about 16%, according to the company. BellRing also cited an early start to a small portion of a promotion at a major mass retailer and stronger baseline velocities as sources of upside versus its expectations.

Dymatize net sales increased 27%, with volume up 6% and price and mix up 21%. CFO Paul Rode said the price-and-mix gain reflected inflation-driven price increases implemented earlier in the year. Consumer demand was particularly strong in e-commerce and international channels, while overseas distribution gains also supported the brand.

Adjusted gross profit was $158 million, and adjusted gross margin declined to 27.7% from 35.1% a year earlier. The decline reflected protein and freight cost inflation, including tariffs, as well as a charge tied to excess bottle-shake inventory.

The inventory charge represented a 180-basis-point headwind during the third quarter and was the main source of variance from BellRing’s forecast, Rode said. Higher-than-expected freight costs also pressured results, though higher sales partly offset the impact.

SG&A expenses totaled $94 million, or 16.4% of sales, including a $7 million increase in advertising spending. BellRing also recorded a $5 million charge related to an organizational realignment announced in late June. The company expects the changes to produce annualized operating-expense savings of $10 million to $12 million once completed, with most of the benefit expected in fiscal 2027.

Updated Fiscal 2026 Outlook BellRing now expects fiscal 2026 net sales of $2.335 billion to $2.375 billion, representing growth of 1% to 3%. Its previous guidance called for sales ranging from flat to up 2%.

The company forecasts adjusted EBITDA of $275 million to $295 million, with an adjusted EBITDA margin of about 12%. The outlook includes $28 million in unfavorable inventory-related impacts, including $21 million already recorded in the second and third quarters. The remaining impact is primarily tied to targeted fourth-quarter trade spending intended to support sell-through of excess bottle inventory.

Tariffs are expected to be an 80-basis-point margin headwind for the full year. Higher freight rates are expected to weigh on second-half margins by about 140 basis points versus the company’s prior outlook. Fourth-quarter net sales are expected to be flat at the midpoint of guidance. Fourth-quarter adjusted EBITDA margin is expected to be about 10%. For the fourth quarter, Premier sales are expected to rise by a low-single-digit percentage, including an approximately 100-basis-point headwind from powders. BellRing expects double-digit ready-to-drink shake volume growth to be mostly offset by unfavorable price mix caused by promotional activity in club, mass and e-commerce channels.

Rode said the company expects Premier shake consumption to rise at a mid-single-digit rate in the fourth quarter, modestly ahead of sales because promotions have a larger effect on BellRing’s net sales. Dymatize and other sales are expected to decline by a mid-single-digit percentage against a difficult comparison period.

Pricing, Distribution and Supply Chain Actions To address sustained input-cost inflation, BellRing announced a double-digit price increase on Premier Protein shakes and additional pricing on powders, both effective in the first quarter of fiscal 2027. The company expects volume-related elasticities from the shake price increase to be slightly greater than one.

Rode said the company’s last shake price increase was nearly two years ago and that the new action is intended to support healthier margins while allowing BellRing to continue investing in the business. He said another major ready-to-drink competitor previously implemented a double-digit increase.

BellRing also plans to broaden its presence across channels. It expects meaningful distribution gains in food, drug and mass retail and e-commerce during fiscal 2027, supported by core products and innovation. In convenience, the company is pursuing targeted regional direct-store-delivery expansion and has hired personnel with DSD expertise.

The company said its 30-gram protein shakes and newly introduced Premier Protein Ultimate product, containing 42 grams of protein, are suited for convenience retail. BellRing is also launching Premier Protein Sparkling Soda, which it said expands the brand into the refreshment category.

Both Ultimate and Sparkling Soda are rolling out to mass, food and e-commerce channels during the fourth quarter. BellRing plans to monitor distribution, consumption, repeat rates and consumer response to advertising and social-media activity as it evaluates the launches.

Fiscal 2027 Focus Rode said BellRing does not view fiscal 2026 margins as its “new normal” and expects adjusted EBITDA margins to improve in fiscal 2027. The company cited the absence of certain inventory-related charges, planned price increases, productivity programs and organizational savings as factors expected to support improvement.

Axelrod said he is not yet prepared to set a long-term margin target. He said his initial priorities include assessing the business’s structural earnings power, identifying execution issues and building a path toward sustainable, profitable growth.

BellRing generated $79 million in operating cash flow during the third quarter and ended the period with net leverage of 3.2 times. The company expects leverage of approximately four times at fiscal year-end due to an anticipated sizable legal-settlement payment in the fourth quarter.

About BellRing Brands (NYSE:BRBR)BellRing Brands, Inc is a consumer packaged goods company specializing in high‐protein, better‐for‐you nutrition products. Formed in March 2020 as a spin‐off from Post Holdings, the company focuses on delivering convenient protein solutions to health‐conscious consumers through a portfolio of well‐known and emerging brands.

The company's product offerings include ready‐to‐drink protein shakes, protein powders, nutrition bars and other performance nutrition items. BellRing Brands' flagship brands include Premier Protein, a line of shakes and bars designed for everyday protein supplementation, as well as Dymatize and PowerBar, which cater to athletes and active individuals seeking advanced sports nutrition formulas.

BellRing Brands markets its products primarily across North America, leveraging relationships with major retailers, wholesale clubs and e-commerce platforms to reach consumers in the United States and Canada.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

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Key Takeaways BRBR trades below industry, sector and historical valuation levels after a sharp 2026 stock decline.BellRing Brands cut 2026 sales and EBITDA guidance amid weaker demand, promotions and higher costs.BRBR benefits from protein demand, distribution gains, innovation and remaining share repurchase capacity. BellRing Brands, Inc. BRBR has seen a sharp valuation reset in 2026 as investors weigh weaker guidance, falling margins and a less certain earnings recovery. The stock’s lower multiple now reflects a more cautious view of the business.

The question is whether that discount adequately compensates investors for execution risks tied to promotions, input costs, freight, mix and the timing of margin improvement.

BRBR Trades Below Key Valuation BenchmarksBRBR trades at 10.2X forward 12-month earnings, below 14.58X for its Zacks sub-industry, 17.0X for the broader Zacks Consumer Staples sector and 20.2X for the S&P 500 index.

The discount also looks large against the company’s own history. BellRing shares trade well below the stock’s five-year median forward earnings multiple, after falling 51.1% year to date and 76.5% over the trailing 12-month period.

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BellRing Brands’ Guidance Reset Raises RiskManagement lowered fiscal 2026 net sales guidance to $2.33-$2.37 billion, or flat to 2% growth. The prior outlook called for $2.41-$2.46 billion, or 4% to 6% growth.

The adjusted EBITDA outlook was cut to $315-$335 million from $425-$440 million. The revision reflects weaker Premier Protein baseline velocities, more muted demand-driver contribution, unfavorable mix, increased trade investment, freight and protein inflation, lower cost savings and reduced selling, general and administrative expense leverage.

BellRing currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

BRBR Earnings Show Significant CompressionBellRing’s fiscal second-quarter earnings showed why the valuation reset alone may not settle the investment debate. Adjusted earnings fell 74% to 14 cents, while adjusted EBITDA declined 55% to $53.8 million.

Adjusted EBITDA margin fell to 9% from 20.2% a year earlier. Premier Protein volumes rose 11%, primarily from promotions and distribution gains, but average net selling prices declined because of promotional investment and unfavorable mix.

That matters for investors assessing sales quality. Volume growth can protect category relevance, but it does not necessarily rebuild earnings if it depends heavily on discounts while costs remain elevated.

BRBR needs better pricing, mix and cost control to convert demand into stronger margins. Until that happens, earnings recovery could lag the company’s top-line opportunity.

BellRing Brands Retains Long-Term SupportThe risk case is balanced by solid long-term demand drivers. BellRing operates in a protein category that remains healthy, with ready-to-drink shakes still benefiting from mainstream wellness trends and retailer support.

Distribution also remains a positive. Premier Protein consumption outside club rose 15% in the fiscal second quarter, while mass, food and eCommerce generated high-teens growth. Innovation through Premier Protein Ultimate and Premier Protein Sparkling Soda adds potential new use cases and shelf opportunities.

The Simply Good Foods Company (SMPL - Free Report) is a relevant active-nutrition comparison because its Atkins and Quest brands compete for health-and-wellness consumer spending. Celsius Holdings, Inc. (CELH - Free Report) , a functional beverage company with CELSIUS and Alani Nu, also shows how wellness-oriented beverage brands are competing for consumer routines and retail space.

Capital allocation provides another support point. BellRing had $516.9 million remaining under its share-repurchase authorization as of March 31, 2026. Management expects strong cash flow in the second half of 2026 and net leverage in the low 3X range for the remainder of the fiscal year.

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BRBR’s Valuation Signal Remains MixedThe bottom line is that BRBR’s lower multiple improves the valuation setup, but it does not erase execution risk. The company still needs to show that category demand, distribution and innovation can translate into better earnings quality.

The current Zacks Rank and individual Style Scores are not specified for BRBR. In general, the Zacks Rank is most useful for evaluating estimate-revision momentum, while Style Scores help investors assess value, growth and momentum characteristics alongside that rank.

For BRBR, the Neutral view and $14 price target point to a balanced risk-reward profile rather than a clear bullish signal. Discounted multiples may attract attention, but weaker visibility around margins and earnings recovery keeps the valuation message mixed.

In the latest trading session, BellRing Brands (BRBR - Free Report) closed at $12.12, marking a +1.08% move from the previous day. The stock exceeded the S&P 500, which registered a loss of 1.01% for the day. Meanwhile, the Dow lost 0.77%, and the Nasdaq, a tech-heavy index, lost 1.4%.

The stock of nutritional supplements company has risen by 26.74% in the past month, leading the Consumer Staples sector's gain of 1.62% and the S&P 500's gain of 0.32%.

The upcoming earnings release of BellRing Brands will be of great interest to investors. The company's earnings report is expected on August 4, 2026. It is anticipated that the company will report an EPS of $0.36, marking a 34.55% fall compared to the same quarter of the previous year. Meanwhile, the latest consensus estimate predicts the revenue to be $553.26 million, indicating a 1.05% increase compared to the same quarter of the previous year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $1.23 per share and revenue of $2.33 billion. These totals would mark changes of -43.32% and +0.7%, respectively, from last year.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for BellRing Brands. Recent revisions tend to reflect the latest near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.2% lower. BellRing Brands is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, BellRing Brands is holding a Forward P/E ratio of 9.79. This expresses a discount compared to the average Forward P/E of 13.22 of its industry.

Also, we should mention that BRBR has a PEG ratio of 5.9. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The average PEG ratio for the Food - Miscellaneous industry stood at 2.53 at the close of the market yesterday.

The Food - Miscellaneous industry is part of the Consumer Staples sector. With its current Zacks Industry Rank of 211, this industry ranks in the bottom 15% of all industries, numbering over 250.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.

ST. LOUIS, July 08, 2026 (GLOBE NEWSWIRE) -- BellRing Brands, Inc. (NYSE:BRBR) today announced it will release its financial results for the third quarter of fiscal year 2026 and its fiscal year 2026 outlook on August 4, 2026, at 7:00 a.m. ET. The release will be followed by a conference call at 8:30 a.m. ET to discuss the results and outlook. Michael C. Axelrod, announced today as the Company’s next President and Chief Executive Officer effective July 29, 2026, and Paul A. Rode, Chief Financial Officer, will participate in the call.

Interested parties may join the conference call by registering in advance at the following link: BellRing Q3 2026 Earnings Conference Call. Upon registration, participants will receive a dial-in number and a unique passcode to access the conference call. Interested parties are invited to listen to the webcast of the conference call, which can be accessed by visiting the Investor Relations section of BellRing’s website at www.bellring.com. A webcast replay also will be available for a limited period on BellRing’s website in the Investor Relations section.

About BellRing Brands, Inc.

BellRing Brands, Inc. (NYSE: BRBR) is a dynamic and fast-growing consumer brands business with the purpose of Changing Lives with Good Energy. Focused on growing the proactive wellness category, the company’s brands include Premier Protein, the #1 ready-to-drink protein and proactive wellness brand, and Dymatize, the brand behind the #1 hydrolyzed protein powder. A culture-driven, pure-play company, BellRing Brands believes nutrition is at the core of a healthy world and produces products with best-in-class nutritional profiles and exceptional flavors. Its products are distributed in over 90 countries across club, mass, food, eCommerce, specialty, drug and convenience. To learn more visit www.bellring.com.

Contact:
Investor Relations
Jennifer Meyer
[email protected]
(415) 814-9388