What Happened?

Shares of egg and butter company Vital Farms (NASDAQ: VITL) fell 18.9% in the afternoon session after the company's weak forecast for the upcoming year overshadowed its fourth-quarter results. 

The food company posted fourth-quarter earnings per share of $0.35, which fell 11% short of analyst estimates. Revenue for the quarter grew 28.7% year-on-year to $213.6 million, meeting expectations. However, investors focused on the downbeat guidance. For the full year 2026, Vital Farms forecasted revenue with a midpoint of $910 million, which was 3.1% below consensus. Furthermore, its Adjusted EBITDA guidance of $110 million at the midpoint fell significantly short of Wall Street's estimate of $133.7 million, raising concerns about future profitability and growth.

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What Is The Market Telling Us

Vital Farms’s shares are very volatile and have had 26 moves greater than 5% over the last year. But moves this big are rare even for Vital Farms and indicate this news significantly impacted the market’s perception of the business.

The biggest move we wrote about over the last year was 4 months ago when the stock gained 14.2% on the news that the company reported strong third-quarter 2025 financial results that surpassed Wall Street's expectations and raised its full-year forecast. Vital Farms posted quarterly earnings of $0.36 per share, easily beating analysts' average estimate of $0.30 per share. This figure more than doubled the earnings of $0.16 per share from the same period in the previous year. Revenue for the quarter came in at $198.9 million, a 37.2% increase year-over-year, which also topped forecasts. Based on this strong performance, Vital Farms increased its financial outlook for the full year. The company now expects net revenue of around $775 million and adjusted EBITDA of around $115 million, signaling confidence in its continued growth.

Vital Farms is down 32.8% since the beginning of the year, and at $20.05 per share, it is trading 61.8% below its 52-week high of $52.41 from August 2025. Investors who bought $1,000 worth of Vital Farms’s shares 5 years ago would now be looking at an investment worth $739.12.

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