What a fantastic six months it’s been for Utz. Shares of the company have skyrocketed 89.5%, hitting $14.31. This run-up might have investors contemplating their next move.
Is now the time to buy Utz, or should you be careful about including it in your portfolio? Check out our in-depth research report to see what our analysts have to say, it’s free.
Why Do We Think Utz Will Underperform?
Despite the momentum, we’re cautious about Utz. Here are three reasons why there are better opportunities than UTZ, plus one stock we’d rather own.
1. Slow Organic Growth Suggests Waning Demand In Core Business
When analyzing revenue growth, we care most about organic revenue growth. This metric captures a business’s performance excluding one-time events such as mergers, acquisitions, and divestitures as well as foreign currency fluctuations.
The demand for Utz’s products has been stable over the last eight quarters but fell behind the broader sector. On average, the company has posted feeble year-on-year organic revenue growth of 1.9%. 
2. Fewer Distribution Channels Limit Its Ceiling
With $1.45 billion in revenue over the past 12 months, Utz is a small consumer staples company, which sometimes brings disadvantages compared to larger competitors benefiting from economies of scale and negotiating leverage with retailers.
3. Previous Growth Initiatives Haven’t Paid Off Yet
Growth gives us insight into a company’s long-term potential, but how capital-efficient was that growth? A company’s ROIC explains this by showing how much operating profit it makes compared to the money it has raised (debt and equity).
Utz’s five-year average ROIC was negative 0%, meaning management lost money while trying to expand the business. Its returns were among the worst in the consumer staples sector.
Final Judgment
We cheer for all companies serving everyday consumers, but in the case of Utz, we’ll be cheering from the sidelines. After the recent rally, the stock trades at 17.7× forward P/E (or $14.31 per share). This multiple tells us a lot of good news is priced in - we think there are better stocks to buy right now. We’d recommend looking at one of Charlie Munger’s all-time favorite businesses.
Stocks We Like More Than Utz
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Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.
