Why BellRing Brands Stock Got Trounced on Thursday
Yahoo Finance ·
BellRing Brands ( BRBR 7.81% ) was flagged as an outlier of a stock on Thursday by a well-known researcher, but not in a good way. This development obscured what seemed to be an orderly transition to leadership announced by the protein products maker that morning. That trading session saw the company absorb a nearly 8% body blow to its share price. Zacks Investment Research named BellRing its bear of the day, ranking it a strong sell. The crux of the researcher's argument is that the company, maker of the Premier Protein shakes and similar products, hasn't effectively coped with mounting competition over time. Zacks senior equity strategist Bryan Hayes wrote in an accompanying analysis that "for years, BellRing rode a powerful tailwind as consumers embraced high-protein diets. But that very success has attracted a flood of competition, and the company now finds itself squarely on the wrong side of a margin squeeze." He added that BellRing is struggling these days with a significant rise in input costs, at a time when ambitious competitors are being aggressive with promotional activities, necessitating higher marketing spend. On top of that, falling demand isn't doing the company any favors.
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