VITL Stock Forecast & Price Target

Vital Farms Inc. demonstrates a robust growth trajectory, with a projected sales growth of 24% for 2026, amounting to $942 million, accompanied by an increase in adjusted EBITDA to $136 million. The company possesses substantial potential for volume growth, as it captures only a 3% share of the market, highlighting significant opportunities for expansion through enhanced distribution and an increasing SKU count at existing retail partners. Vital Farms's sustained double-digit revenue growth since going public, along with a strong market presence as a premium egg brand, underscores its ability to capitalize on operational efficiencies and consumer demand for high-quality, ethically-produced food products.

Vital Farms Inc. has experienced a significant decline in its share price despite demonstrating consistent earnings growth and an optimistic outlook for volume-driven expansions, as evidenced by its current EV/FY2 EBITDA multiple trading at approximately 10x, reflecting a notable 25% discount to historical averages. The company faces considerable gross margin headwinds driven by higher promotional costs, tariffs, and escalating commodity prices, leading to a contraction in EBITDA margins that fall short of long-term targets. Additionally, the recent reduction in 2025 sales guidance to a range of $755MM-$765MM, down from previous expectations, raises concerns about potential distribution losses that could further impair financial performance and negatively affect equity valuation.