Mama’s Creations (NASDAQ:MAMA) Issues Quarterly Earnings Results

Mama’s Creations (NASDAQ:MAMA) posted its earnings results on Thursday. The company reported $0.06 EPS for the quarter, topping analysts’ consensus estimates of $0.05 by $0.01, Zacks reports. Mama’s Creations had a return on equity of 15.54% and a net margin of 3.53%.The business had revenue of $54.58 million during the quarter, compared to analyst estimates of $52.85 million.

Here are the key takeaways from Mama’s Creations’ conference call:

• Q2 revenue rose 55% to $54.6 million, while adjusted EBITDA increased 69% to $5.5 million and net income more than doubled to $2.6 million. Adjusted EBITDA margin expanded to 10.1% as operating expenses declined 160 basis points as a percentage of revenue.
• Mama’s ended the quarter with $138.6 million in cash and only $4.8 million of debt, following its July equity offering and strong operating cash flow. Management said the stronger balance sheet enables larger, strategically focused, and potentially accretive acquisitions involving capabilities, capacity, or customer access.
• Distribution momentum continued with a planned launch in more than 100 Kroger stores, a new breaded chicken item in 300 Sam’s Club locations, Walmart expansion to more than 2,300 stores, and an all-region Costco multi-vendor mailer expected to exceed last year’s revenue.
• Gross margin improved sequentially to 24.0% from 23.6%, but remained below the prior year’s 24.9% as the company invested more heavily in trade promotion. Management expects further improvement toward its mid- to high-20% target through greater chicken-bottom mix, Bay Shore efficiencies, and production scale, though product velocity and portfolio cleanup remain execution factors.

Mama’s Creations Stock Performance

Shares of MAMA opened at $15.16 on Friday. The company has a debt-to-equity ratio of 0.09, a current ratio of 2.32 and a quick ratio of 1.90. Mama’s Creations has a one year low of $8.67 and a one year high of $21.00. The firm has a market capitalization of $620.65 million, a P/E ratio of 89.18 and a beta of 0.56. The business has a fifty day moving average of $17.53 and a 200 day moving average of $16.12.

Analyst Ratings Changes

MAMA has been the topic of several recent analyst reports. Weiss Ratings raised Mama’s Creations from a “hold (c+)” rating to a “buy (b-)” rating in a research report on Thursday. Benchmark started coverage on shares of Mama’s Creations in a research note on Tuesday, July 21st. They set a “buy” rating and a $25.00 target price on the stock. Wall Street Zen cut shares of Mama’s Creations from a “buy” rating to a “hold” rating in a research note on Sunday, July 12th. Zacks Research downgraded shares of Mama’s Creations from a “strong-buy” rating to a “hold” rating in a report on Tuesday, July 28th. Finally, Lake Street Capital reiterated a “buy” rating and issued a $22.00 price target on shares of Mama’s Creations in a research note on Friday. One investment analyst has rated the stock with a Strong Buy rating, six have issued a Buy rating and one has assigned a Hold rating to the stock. Based on data from MarketBeat.com, the company has a consensus rating of “Buy” and an average price target of $20.00.

Mama’s Creations News Roundup

Here are the key news stories impacting Mama’s Creations this week:

• Positive Sentiment: Quarterly results exceeded expectations: Fiscal Q2 revenue rose 55% year over year to $54.6 million, beating the $52.85 million consensus estimate, while diluted EPS of $0.06 topped expectations by $0.01 and doubled from the prior year. Mama’s Creations Reports Second Quarter Fiscal 2027 Financial Results
• Positive Sentiment: Profitability and operating leverage improved: Net income increased 101% to $2.6 million, adjusted EBITDA climbed 69% to $5.5 million, and operating expenses declined as a percentage of revenue. Management said gross margin improved sequentially and remains on track toward its mid-to-high-20% target. MAMA Q2 Earnings Beat Estimates on Retail Expansion, Bay Shore Gains
• Positive Sentiment: Retail expansion supports future growth: New and expanded placements at Costco, Kroger, Publix, Albertsons, Winn-Dixie and other retailers are broadening distribution. Costco selected Mama’s for a national promotional mailer, while the company plans its first Kroger launch in more than 100 stores.
• Positive Sentiment: Strong balance sheet enables acquisitions: Cash increased to $138.6 million, including approximately $108.6 million from a July stock offering and $11.9 million of operating cash flow. Management said the funds improve its ability to pursue accretive acquisitions aimed at its $1 billion revenue objective.
• Neutral Sentiment: Analyst remains bullish but lowered its target: DA Davidson reduced its price target from $25 to $22 while maintaining a “Buy” rating, signaling continued confidence but more cautious near-term valuation expectations. DA Davidson price target report
• Negative Sentiment: Investors may be reacting to dilution and margins: The stock offering increased shares outstanding, while gross margin declined year over year to 24.0% from 24.9%, despite improving sequentially. Operating expenses also rose in absolute dollars, primarily because of the Bay Shore acquisition. With the shares trading at a high earnings multiple, investors may have expected an even stronger outlook or clearer margin expansion.

Institutional Inflows and Outflows

A number of institutional investors have recently bought and sold shares of the company. American Century Companies Inc. grew its stake in shares of Mama’s Creations by 1.6% during the 2nd quarter. American Century Companies Inc. now owns 89,062 shares of the company’s stock valued at $739,000 after purchasing an additional 1,375 shares during the period. Rhumbline Advisers lifted its stake in shares of Mama’s Creations by 4.8% in the 2nd quarter. Rhumbline Advisers now owns 46,824 shares of the company’s stock worth $389,000 after purchasing an additional 2,125 shares during the period. Invesco Ltd. raised its position in Mama’s Creations by 10.9% in the fourth quarter. Invesco Ltd. now owns 22,299 shares of the company’s stock worth $301,000 after acquiring an additional 2,183 shares during the period. Alliancebernstein L.P. raised its position in Mama’s Creations by 13.0% in the third quarter. Alliancebernstein L.P. now owns 21,750 shares of the company’s stock worth $229,000 after acquiring an additional 2,500 shares during the period. Finally, Price T Rowe Associates Inc. MD grew its position in shares of Mama’s Creations by 14.7% during the 4th quarter. Price T Rowe Associates Inc. MD now owns 20,692 shares of the company’s stock valued at $280,000 after acquiring an additional 2,646 shares during the period. Institutional investors own 45.18% of the company’s stock.

About Mama’s Creations

Mama’s Creations, Inc engages in the marketing, manufacturing, and distribution of beef meatballs with sauce, turkey meatballs with sauce, beef meat loaf, sausage and peppers, chicken parmesan, and other similar meats and sauces. Its products include beef meatballs, turkey meatballs, stuffed meatballs, lasagna roll ups, retail ready meals, bulk deli, single-size pasta bowls, and packaged refrigerated products. Its brands include MamaMancini’s, Creative Salads, and The Olive Branch. The company was founded by Daniel Dougherty on July 22, 2009 and is headquartered in East Rutherford, NJ.