Post Holdings, Inc. POST is trading at $114.82 (as of April 16, 2025), positioning itself firmly above the 50 and 200-day simple moving averages (SMA) of $113.63 and $112.59, respectively. This upward trajectory highlights the stock’s strong momentum and price stability, signaling positive investor sentiment. As POST continues to outperform key technical benchmarks, investors are now evaluating their next move: should they take profits, increase their positions or hold existing shares?

POST 50 and 200-day Simple Moving Averages

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Post Holdings stock has risen 6.4% in the past three months, outperforming the industry’s growth of 1.6% and the S&P 500's decline of 10.4%. The stock is currently 8.8% below its 52-week high of $125.84, attained on Dec. 13, 2024, presenting a compelling opportunity for value-focused investors, as the company regains ground.

POST Stock Past Three-Month Performance

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Post Holdings’ Growth Drivers

Post Holdings has been benefiting from the focus on acquisitions, which has been helping it expand customer base. In the first quarter of fiscal 2025, the company reported $60.8 million in net sales from acquisitions. Committed to its long-term growth strategy, Post Holdings remains dedicated to pursuing accretive M&A opportunities. Further strengthening its portfolio, the company completed the acquisition of Potato Products of Idaho, L.L.C. (“PPI”) on March 3, 2025, marking a strategic entry into the refrigerated and frozen potato market.

Post Holdings delivered a standout performance in its Foodservice segment, which played a pivotal role in driving growth during the quarter. The segment reported a robust 8.7% increase in net sales, reaching $616.6 million, alongside a 2.8% rise in volumes. This growth was primarily fueled by strong distribution gains in key product categories, particularly eggs and potatoes, as demand from restaurants, institutional clients and foodservice operators continued to rise.

Post Holdings has continued to benefit from strategic pricing actions in the fiscal first quarter, effectively countering inflationary pressures and supply-chain costs while preserving profitability in a challenging macroeconomic environment. Across its portfolio, Post Holdings saw a 3% increase in average net pricing in the fiscal first quarter.

What Might Hurt Post Holdings Stock?

The company’s Post Consumer Brands segment faced a range of challenges in the first quarter of fiscal 2025, reporting net sales of $963.9 million, a 2.5% decline year over year, including $54.4 million in sales from Perfection. Excluding Perfection’s contribution in both the current and prior-year periods, volumes declined 8.8%, reflecting persistent headwinds in the segment. This decline was primarily caused by weakness in both pet food and cereal categories.

Facing persistent softness in the ready-to-eat cereal market, the company announced on April 4, 2025, plans to shut down two of its cereal production plants, located in Cobourg, Ontario, and Sparks, NV, by year-end. The decision reflects a strategic effort to align production with demand and optimize resources.

The Refrigerated Retail segment also encountered several hurdles during the quarter. Net sales and volumes for the segment declined 5.1% and 4.4%, respectively. While sausage volumes showed favorable performance, it was more than offset by declines in side dish, egg and cheese products.

Post Holdings has been seeing a rise in SG&A costs for the past several quarters. In the first quarter of fiscal 2025, the metric increased 2.7% to $331.6 million, whereas as a percentage of net sales, the metric expanded 40 basis points to 16.8%. The latest quarter included $15.6 million in integration costs, primarily related to pet food acquisitions. The persistence of the trend is concerning for the company.

POST Stock’s Valuation

From a valuation perspective, Post Holdings is trading at a premium compared with industry benchmarks. The company’s forward 12-month price-to-earnings multiple of 16.56X remains above the industry average of 16.09X. The valuation does suggest that the company is overvalued.

POST P/E Ratio (Forward 12 Months)

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What is the Right Investment Strategy for POST?

Post Holdings has been battling several challenges, including segment-specific volume pressures, rising SG&A expenses and premium valuation. Despite these, the company continues to demonstrate solid momentum, driven by its strategic acquisitions, strong Foodservice performance and effective pricing actions. Its focus on portfolio expansion and disciplined cost management supports long-term growth potential, while the stock's recent outperformance and positioning near key technical levels indicate underlying strength. Given these factors, long-term investors may consider holding the stock. Currently, POST carries a Zacks Rank #3 (Hold).

Stocks to Consider

United Natural Foods, Inc. UNFI distributes natural, organic, specialty, produce and conventional grocery and non-food products in the United States and Canada. At present, United Natural carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 

The consensus estimate for United Natural’s current fiscal-year sales and earnings implies growth of 1.9% and 485.7%, respectively, from the year-ago figures. UNFI delivered a trailing four-quarter earnings surprise of 408.7%, on average.

Utz Brands UTZ engages in the manufacture, marketing and distribution of snack foods in the United States and presently carries a Zacks Rank of 2. Utz Brands delivered a trailing four-quarter earnings surprise of 8.8%, on average.

The Zacks Consensus Estimate for Utz Brands’ current financial-year sales and earnings indicates growth of 1.2% and 10.4%, respectively, from the year-ago numbers.

Pilgrim's Pride Corporation PPC, which produces, processes, markets and distributes fresh, frozen and value-added chicken and pork products to retailers, distributors and foodservice operators in the United States, Europe and Mexico, currently holds a Zacks Rank #2. PPC delivered an earnings surprise of 25.7% in the trailing four quarters, on average. 

The Zacks Consensus Estimate for Pilgrim’s Pride’s current-quarter earnings indicates growth of 64.9%, respectively, from the prior-year reported level.

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This article originally published on Zacks Investment Research (zacks.com).

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