Amplify Snack Brands Inc (NYSE:BETR) Crumples On Earnings Miss and Analyst Angst


Amplify Snack Brands Inc (NYSE:BETR) fell sharply Tuesday after it released a worse-than-expected profit for the third quarter and was downgraded by two prominent analyst firms.

Investors may be diehard fans of the company’s Skinny Pop popcorn on store shelves (“a delicious snack that you can feel great about eating everyday”), but in the stock market, they didn’t feel much love for the company’s earnings report. Shares lost nearly a fourth of their value Tuesday, closing at $10.19, on volume of 10.94 million. That’s a lot below its IPO price of $18.

Technically, on the daily chart, the stock had already been shaping up for a decline on Monday November 14 when it slipped below the 200-day moving average. The earnings report only acted as a catalyst, pushing the stock further down with an opening gap that accounted for the bulk of the day’s losses.

A reference to the longer term monthly chart shows that there could be a further decline if the stock is unable to keep above $10 – a long term line of support.

Amplify Snack Brands Inc (NYSE:BETR) disappoints in the third quarter

The snack maker reported Q3 EPS of $0.12, which missed by $0.03, and revenue of $68 million, which beat by $2.83 million, and was up 48.1% year on year. The Tyrrells international portfolio of brands, which the Company acquired September 2016, contributed $8.6 million to net sales in the quarter.

“Strong brand sales gains continued in the quarter, despite a more challenging market backdrop, and we experienced certain transitory operational execution issues that impacted our results,” said Tom Ennis, President and Chief Executive Officer. “Amplify is now a much stronger and more diversified company, and we’ve proactively taken steps to sharpen execution going forward.”

Net debt grew to $596.2 million as of September 30, 2016, compared to $182.5 million as of December 31, 2015. “The increase was primarily attributable to the acquisition of the Tyrrells portfolio of international brands during the nine months ended September 30, 2016,” the company clarified.

It assured that it intends to reduce its leverage by organic growth, cost reduction initiatives and additional free cash generation.

Analysts chop Amplify Snack Brands Inc (NYSE:BETR) ratings

Amplify was downgraded by Goldman Sachs from Buy to Neutral.

Credit Suisse lowered their rating from Outperform to Neutral, while Oppenheimer downgraded from Outperform to Perform.


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