One-glance verdict
Undervalued
$19.78 our estimate vs market $10.03
Wall Street consensus: $13.22 (-33.1% lower than our fair-value estimate)
49% below our estimate, below the bear case
Fundamentals snapshot
Vital Farms, Inc.
VITL · NGM · Consumer Defensive · Farm Products
Current price
$10.03
52-week range
$7.95 - $49.04
Market cap
$430.60M
Balance sheet
Healthy
101.11x Strong cushion
Net debt $87.01M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 0.8% last year.
- Reward Returns 0.1% on equity, ahead of 20% of its peers.
- Reward Free cash flow was positive in 5/10 years.
- Risk Operating margin compressed from 0.6% to -24.2% over 3 years.
What this company does
Vital Farms, Inc.
Vital Farms sells eggs and butter that come from hens and cows raised on family farms with outdoor pasture access. The company makes most of its money by selling these products at a higher price than conventional brands in grocery stores. This focus on ethical and quality farming is important because it builds a loyal customer base willing to pay more, which can lead to healthier profit margins (the portion of each dollar in sales that the company keeps as profit).
How the company got here
Vital Farms was started in 2007 by Matt O'Hayer on a small 27-acre farm in Austin, Texas, with just 20 hens. His idea was to build a company focused on producing eggs ethically, in a way that was better for the animals and the environment, which was different from the large-scale industrial farms. The company grew by partnering with a network of family farms that raise hens according to its standards. A key turning point was in July 2020, when Vital Farms had its initial public offering (IPO), meaning it began selling shares of the company to the public on the stock market.
What it actually does
Vital Farms sells food products that come from animals raised on family farms with high standards for animal welfare. You would recognize their products in the grocery store, mainly in the dairy and egg aisles, sold under the Vital Farms brand name. The company's main goal is to provide ethically produced food to a wide range of customers across the United States. They work with hundreds of family farms to source their products, which are then sold in over 24,000 stores.
Eggs and Egg-Related Products
This is the company's core business and makes up the vast majority of its revenue (the total money it brings in from sales). They sell pasture-raised shell eggs, which means the hens have space to roam outdoors. You can find these in various sizes, including large and extra-large, as well as organic options. This segment also includes convenient ready-to-eat products like hard-boiled eggs and liquid whole eggs.
What management is betting on now
The company's leadership is focused on growing its main egg business and making its brand more widely known. A major priority is expanding their supply chain (the network of farms, transportation, and facilities needed to get products to stores) to keep up with customer demand. They are building a second egg washing and packing facility to support future growth and get their products to more stores across the country. Management has also announced a plan to wind down its butter business to focus more on its core egg products.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$6.39M
FY2024 Q4
$-3.38M
FY2025 Q1
$2.15M
FY2025 Q2
$-7.63M
FY2025 Q3
$-10.61M
FY2025 Q4
$-32.15M
FY2026 Q1
$-39.31M
FY2026 Q2
$-44.06M
Revenue
$166.03M
Net income
$-31.07M
Diluted EPS
-0.72
Operating cash flow
$-27.36M
Free cash flow
$-44.06M
Fetching…
Sources
Revenue
$187.16M
Net income
$-1.52M
Diluted EPS
-0.03
Operating cash flow
$-18.55M
Free cash flow
$-39.31M
Fetching…
Sources
Revenue
$213.55M
Net income
$16.32M
Diluted EPS
0.35
Operating cash flow
$5.78M
Free cash flow
$-32.15M
Fetching…
Sources
Revenue
$198.94M
Net income
$16.42M
Diluted EPS
0.36
Operating cash flow
$23.42M
Free cash flow
$-10.61M
Fetching…
Sources
Revenue
$184.77M
Net income
$16.64M
Diluted EPS
0.36
Operating cash flow
$-761.00K
Free cash flow
$-7.63M
Fetching…
Sources
Revenue
$162.19M
Net income
$16.90M
Diluted EPS
0.37
Operating cash flow
$5.27M
Free cash flow
$2.15M
Fetching…
Sources
Revenue
$165.99M
Net income
$10.58M
Diluted EPS
0.23
Operating cash flow
$14.78M
Free cash flow
$-3.38M
Fetching…
Sources
Revenue
$145.00M
Net income
$7.45M
Diluted EPS
0.16
Operating cash flow
$9.96M
Free cash flow
$6.39M
Fetching…
Sources
Is it cheap or expensive?
Fair value $19.78 vs current price $10.03
Wall Street consensus is the average analyst price target: $13.22 (-33.1% lower than our fair-value estimate).
Our most-likely fair value is $19.78 a share — about 97.2% above today's price of $10.03, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net debt $87.0M. Interest coverage 101.1x.
Net debt
$87.01M
Interest coverage
101.11x
Vital Farms, Inc.'s profit covers its interest bill about 101.1 times over. which is stronger than most peers shown here.
Healthy
Worse cushion
Baseline
Better cushion
VITL
BASELINE
Vital Farms, Inc.
Total debt $108.25M Interest coverage 101.11x This is the baseline the peer rows are being compared against.
Total debt $0.00 Interest coverage 560.06x +454% vs VITL Carries about 5.5x more debt cushion than VITL.
Total debt $595.80M Interest coverage 1.09x -99% vs VITL Carries about 93.0x less debt cushion than VITL.
Total debt $22.47M Interest coverage 210.03x +108% vs VITL Carries about 2.1x more debt cushion than VITL.
Total debt $12.92M Interest coverage 15.07x -85% vs VITL Carries about 6.7x less debt cushion than VITL.
What you should know
The case for and against VITL
3 Rewards
1 Risk
Rewards
-
Revenue grew 0.8% last year.
-
Returns 0.1% on equity, ahead of 20% of its peers.
-
Free cash flow was positive in 5/10 years.
Risks
-
Operating margin compressed from 0.6% to -24.2% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
—
Forward P/E
38.28x
P/B
1.33x
P/S
0.56x
EV/EBITDA
32.94x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
28.1%
Operating margin
-24.2%
Net margin
0.0%
ROE
0.1%
ROA
0.0%
Health
Liquidity and balance-sheet strength
Debt / equity
0.38x
Current ratio
1.10x
Quick ratio
0.54x
Total debt
$108.25M
Total cash
$21.24M
Growth
How the business has been compounding
Revenue TTM
$765.67M
Revenue 5Y CAGR
30.6%
EPS TTM
-0.05
EPS 5Y CAGR
263.4%
Cash flow
How much cash the business throws off
Operating CF TTM
$-16.71M
Free CF TTM
$-48.23M
FCF margin
-6.3%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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