Packaged foods company Post (NYSE: POST) reported Q2 CY2025 results topping the market’s revenue expectations, with sales up 1.9% year on year to $1.98 billion. Its non-GAAP profit of $2.03 per share was 22.8% above analysts’ consensus estimates.
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Post (POST) Q2 CY2025 Highlights:
- Revenue: $1.98 billion vs analyst estimates of $1.95 billion (1.9% year-on-year growth, 1.9% beat)
- Adjusted EPS: $2.03 vs analyst estimates of $1.65 (22.8% beat)
- Adjusted EBITDA: $397 million vs analyst estimates of $367.1 million (20% margin, 8.1% beat)
- EBITDA guidance for the full year is $1.51 billion at the midpoint, above analyst estimates of $1.49 billion
- Operating Margin: 11.8%, up from 10.4% in the same quarter last year
- Free Cash Flow Margin: 4.8%, down from 8.3% in the same quarter last year
- Market Capitalization: $5.73 billion
Company Overview
Founded in 1895, Post (NYSE: POST) is a packaged food company known for its namesake breakfast cereal and healthier-for-you snacks.
Revenue Growth
Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years.
With $7.92 billion in revenue over the past 12 months, Post is one of the larger consumer staples companies and benefits from a well-known brand that influences purchasing decisions.
As you can see below, Post grew its sales at a solid 12.1% compounded annual growth rate over the last three years despite consumers buying less of its products. We’ll explore what this means in the "Volume Growth" section.
This quarter, Post reported modest year-on-year revenue growth of 1.9% but beat Wall Street’s estimates by 1.9%.
Looking ahead, sell-side analysts expect revenue to grow 13.5% over the next 12 months, similar to its three-year rate. This projection is noteworthy and indicates its newer products will fuel better top-line performance.
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Cash Is King
Free cash flow isn't a prominently featured metric in company financials and earnings releases, but we think it's telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king.
Post has shown decent cash profitability, giving it some flexibility to reinvest or return capital to investors. The company’s free cash flow margin averaged 6.4% over the last two years, slightly better than the broader consumer staples sector.
Taking a step back, we can see that Post’s margin dropped by 1.9 percentage points over the last year. If its declines continue, it could signal increasing investment needs and capital intensity.
Post’s free cash flow clocked in at $94.9 million in Q2, equivalent to a 4.8% margin. The company’s cash profitability regressed as it was 3.5 percentage points lower than in the same quarter last year, suggesting its historical struggles have dragged on.
Key Takeaways from Post’s Q2 Results
We were impressed by how significantly Post blew past analysts’ EBITDA expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. Overall, we think this was a solid quarter with some key areas of upside. The stock traded up 3% to $106 immediately following the results.
Post had an encouraging quarter, but one earnings result doesn’t necessarily make the stock a buy. Let’s see if this is a good investment. The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free.
