The City gave the cold shoulder to Applied Nutrition this week after a market update detailing rampant sales growth and a major bump to profits led to a paradoxical fall in share price.
The sports nutrition group’s stock jumped 7% following the announcement – before dropping as investors cashed in. No further increase followed, and by the next day the shares traded 1.5% below their pre-announcement price.
Applied Nutrition’s shares have already increased 94.1% in value over the past year, and currently trade a little below an all-time high of 350p reached in early August, which Wednesday’s upgraded profit guidance was unable to restore.
Analysts’ praise was therefore cut with a note of caution over a “fairly full” valuation, as Peel Hunt analyst John Stevenson labelled it.
“Applied Nutrition continues to scale rapidly, and we can see FY2027 revenues outstripping current forecasts and guidance, particularly on the US front,” he said.
He noted that with normalising margins and increasing whey prices, the company’s high market cap may not have much further room for increases without profit growth.
The company said “strong and sustained demand” had boosted sales by 50% to £160m in the year to 31 July 2026. It had previously upgraded guidance to £148m at the start of June.
The pre-audit figures also showed a 40% increase in EBITDA to approximately £43.3m. The numbers excluded the acquisition of vertically integrated US subsidiary Nutrablend in June 2026, which is expected to simplify operations and help ramp up growth in North America.
The acquisition contributed the sole weak spot in the update: while increasing EBITDA on an absolute basis, it will hit Applied Nutrition’s profit margin next year, alongside higher whey prices.
Trading momentum had been “exceptional” in 2026, said Panmure Liberum analyst Wayne Brown. He added that the US acquisition, tie-ups with leading retailers and other brands should aid that momentum in the new financial year.
“We upgrade our forecasts [for the company] again, despite the challenges thrown at the industry from higher whey prices, Iran war and a backdrop of low consumer confidence in the UK,” he said.
“The long-term trends of health and fitness are clearly global and becoming more entrenched and Applied Nutrition’s dynamic model is clearly taking significant shelf space.”
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