Simply Good Food: Why Could the Protein Snack Maker's Stock Rise by 35%?

Demand for protein among health-conscious consumers is growing rapidly. However, Simply Good Food—one of the pioneers in the production of protein bars, shakes, and other high-protein products—is facing challenges. Read the Oninvest article to find out how the company is trying to revitalize its Atkins and Quest brands, and why Wall Street believes it will succeed.

Simply Good Food itself was founded in 2017, but the history of its flagship brand, Atkins, actually began much earlier. Atkins Nutritionals was founded in 1989 by cardiologist Robert Atkins—the creator of the low-carb diet and author of more than a dozen books detailing its benefits.

"Cheeseburger without a bun"—that's what people jokingly called the Atkins principles, since his diet allows you to eat fatty foods—bacon, meat, cheese, eggs, mayonnaise—but restricts carbohydrates. The doctor launched his own brand to make it easier for dieters to follow his dietary recommendations and snack on the right foods. The Atkins diet peaked in popularity in the early 2000s: about 30 million Americans tried it, according to The Guardian, but the professional community was critical of it.

In 2003, Dr. Atkins died in an accident. Later that same year, Parthenon and Goldman Sachs Capital closed the deal to acquire Atkins; the terms of the deal were not disclosed. Management decided to turn Atkins into a versatile brand and launch more than a thousand new products, including macaroni and cheese, ice cream, barbecue sauce, and vitamins. But in 2005, the company filed for bankruptcy, with approximately $300 million in debt.

In 2007, after emerging from bankruptcy, Atkins was acquired by the investment firm North Castle Partners; in 2010, it came under the control of Roark Capital. The new owners focused on expanding the healthy snacks category, positioning them as part of a healthy lifestyle rather than a temporary diet.

The brand continued to expand its snack lineup and invest more in marketing. The company began collaborating with celebrities: Sharon Osbourne, co-host of the CBS talk show “The Talk,” became a brand ambassador and lost weight with Atkins. As a result, the company reported eight consecutive years of retail sales growth in the U.S.

In 2017, Atkins went public through a merger with the SPAC Conyers Park Acquisition Corp.; following the closing of the transaction, the publicly traded company The Simply Good Foods Company was formed.

Simply Good Foods planned to grow not only through the well-known Atkins brand, but also by acquiring complementary brands—the first of which was Quest Nutrition, purchased in 2019 for $1 billion.

Over the past few years, Quest has grown from a startup making protein bars in a kitchen into a billion-dollar business by engaging a growing community of fitness bloggers and influencers. Quest founder Tom Billeau told Forbes that he had overcome obesity himself and decided to help others do the same with food that would be “metabolically advantageous” but unlike anything else on the market. Quest became famous for its dessert-flavored bars —“chocolate chip cookie,” “raspberry in white chocolate,” “blueberry muffin”—as well as its protein chips, one of the brand’s most popular products.

In 2024, the company began discussing the need for a brand refresh; last year, it started cutting back on underperforming products and distribution channels to maintain profitability. In addition, Atkins, the company’s oldest brand, began to experience difficulties, the company reported in its 2024 fiscal year results.

Simply Good Foods continues to face challenging times—despite the company's steady business expansion and the rapid rise in popularity of protein-rich products, according to The Wall Street Journal.

In January 2026, President and CEO Joe Scalzo returned to revive the company, having been dissatisfied with the results at the start of the year: “We faced challenges in executing our strategy amid a dynamic and highly competitive market,” Scalzo said in a WSJ report. Simply Good Foods expects that the Atkins brand could benefit from the growing use of GLP-1 drugs for weight loss, as people trying to lose weight need to maintain muscle mass while consuming fewer calories.

Simply Good Foods’ net revenue for the third quarter of fiscal year 2026 declined 6.3% year-over-year to $357 million. The main reason was a 24.6% drop in sales of the Atkins brand, which was only partially offset by a 1.1% increase at Quest and a 3.6% increase at OWYN, a protein shake manufacturer that Simply Good Foods acquired in 2024. The company attributed these results to a previously anticipated reduction in Atkins’ distribution, as well as weaker retail sales. The net loss was $52.0 million, compared to a net profit of $41.1 million for the same period last year.

Quest already accounts for about 65% of Simply Good Foods’ total revenue; its sales had been growing at a high rate—even in the double digits—for several years, but that momentum has now slowed due to market saturation and competition. Other brands regularly release new flavors and limited-edition lines to keep consumers interested, Michael Günter, senior vice president of research and analytics at Consumer Edge, told the WSJ. For example, Barebells’ lineup includes “lime pie” and “orange cream ice cream” flavors, while Built Brands offers marshmallow-like bars.

“Simply Good Foods’ third-quarter results exceeded expectations in terms of both revenue and profit,” wrote DA Davidson analysts Matt Curtis and Andrew Tompkins in their June report (available to the Oninvest editorial team).

Analysts cite stronger sales of Quest and OWYN as the main source of the positive surprise, although sales of Quest bars are suffering due to a lack of innovation compared to competitors. However, the DA Davidson team believes that Simply Good Foods is still in the early stages of its turnaround program, and “there is not yet sufficient confidence in a sustainable improvement in sales.” DA Davidson analysts maintained their Neutral rating with a price target of $14. This is 26.8% above the closing price on July 21.

Deutsche Bank analysts believe that inflation is weighing on Simply Good Foods’ performance: the company is facing high costs for whey protein, packaging, and logistics, they wrote in a report dated July 10 (available to the Oninvest editorial team). Analysts expect gross margins to recover in fiscal year 2027: price increases across all three brands in September and improved productivity should offset rising costs. Deutsche Bank raised its target price from $13 to $14 but maintained its “hold” rating.

Since the beginning of 2026, Simply Good Foods’ stock has fallen 45%. Of the 11 Wall Street analysts tracking the company, six have a “hold” rating on the stock and four have a “buy” rating. With an average target price of $14.88, the stock has upside potential of nearly 35% relative to its closing price on July 21.