Boosted by interest in healthy snacks and the Atkins diet, Simply Good Foods (SMPL) has whipped its fundamentals into good shape. Leading money managers have also bought into the company’s financial fitness plan, with 81 funds earning an A or A+ rating from IBD buying SMPL stock.
Over the last three years, the Denver-based company’s healthy snacks and nutritional foods have fed average annual earnings growth of 194%.
Simply Good Foods has generated average annual sales growth of 31%, including 52% revenue growth last quarter. In Stock Checkup, the stock earns an A SMR Rating, which tracks a combination of sales growth, profit margins and return on equity.
Atkins Diet Aids Quest For Simply Good Foods
Focused on two core brands — Atkins and Quest Nutrition — Simply Goods Foods aims to “empower healthy lives through smart and satisfying nutrition.”
Targeting low carb and ketogenic lifestyles, the Atkins diet is designed to channel one’s metabolism to burn fat instead of carbs and sugar.
Simply Good Foods provides its own alternatives to a “classic” keto diet. The Atkins 20 and Atkins 40 approaches have lower fat content and higher protein intake than a traditional keto diet.
Under the Quest brand, Simply Good Foods offers protein bars and a range of products to help minimize carbs and sugar to prevent spikes in blood sugar and promote healthy digestion.
Healthy Snacks, Healthy Breakout
After breaking out then pulling back last week, SMPL stock is back to trading at the top of its buy range. Since launching the initial breakout move from a second-stage base, the stock has maintained support above its 10-week moving average.
The buy zone from the 32.13 buy point extends to 33.77. As CAN SLIM investors like to see as a stock breaks out, the relative strength line is trending higher. The RS line for SMPL stock is just shy of a 52-week high.
Volume on the initial breakout on March 10 was 198% above average. On Monday, Simply Good Foods at near the top of the day’s price range at the very top of the buy zone.
Look for strong upside volume to kick in as SMPL stock tries to fuel its return to a new high.
Follow Matthew Galgani on Twitter at @IBD_MGalgani.
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