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Bull of the Day: Nomad Foods (NOMD)

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It’s no secret that staples are back in favor. With the Fed likely approaching the end of its rate hiking cycle and markets adjusting to a slower-growth reality, investors are once again flocking to the stability of steady earnings and strong cash flow. And right now, few names in the frozen food aisle look as appealing as Nomad Foods (NOMD - Free Report) .

Nomad Foods is the European frozen food powerhouse behind brands like Birds Eye, Iglo, Findus, and Aunt Bessie’s. It may not have the sizzle of tech or the yield of energy, but in uncertain times, frozen peas and fish fingers can be a surprisingly lucrative proposition. The company's focus on branded frozen foods across Western Europe gives it durable pricing power and loyal customers. More importantly for investors—it's printing profits.

The reason for Nomad Foods ((NOMD - Free Report) ) appearance today isn’t just its boring-but-beautiful business model. It’s the series of recent earnings estimate revisions that have analysts—and Zacks—paying attention. Over the last 30 days, two analysts have increased their estimates for both the current and next year. That’s the kind of across-the-board bullishness we like to see.

Those revisions have pushed the Zacks Consensus Estimate for 2024 EPS from $1.95 to $2.15, and for 2025 from $2.11 to $2.31. That’s a healthy bump, signaling confidence in both near-term execution and longer-term profitability. In fact, NOMD is expected to grow earnings over 11.4% this year and follow that up with another 7% next year, not bad for a consumer staples stock.

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Despite the upward estimate revisions, NOMD trades at a forward P/E of just 9.3x, well below the broader market and even below most of its consumer staples peers. For a company with strong brands, resilient margins, and a growing presence in private-label and health-conscious frozen offerings, that valuation is a compelling entry point.

Let’s not forget the strong free cash flow. NOMD has consistently converted a healthy portion of earnings into cash, giving it the ability to reinvest in growth, pay down debt, and return value to shareholders.

In a market that's rewarding consistency and punishing volatility, Nomad Foods offers a refreshing mix of stability and upside. With a Zacks Rank #1 (Strong Buy), improving earnings outlook, and defensive positioning, this frozen food leader is heating up in all the right ways.


 


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