William Blair & Company LLC

11/30/2021 | Press release | Distributed by Public on 11/30/2021 11:45

The Real Good Food Company, Inc.: Initiation of Research Coverage

William Blair initiated research coverage of The Real Good Food Company, Inc. (RGF $8.46), a rapidly growing company that innovates, produces, and sells on-trend branded frozen foods.

Analyst Jon Andersen estimated that the company would generate sales of $82.9 million in 2021 and $118.4 million in 2022.

"Real Good's current addressable market is $30 billion (at retail), including core and other frozen categories," Andersen said. "Looking forward, Real Good should derive the preponderance of its growth from frozen entrées and breakfast items, two of the largest frozen food segments."

He added, "We project Real Good to grow sales at a compound annual rate of 58% from 2020 to 2023. Growth will be volume driven, aided by distribution expansion, and led by frozen entrées and breakfast sandwiches. We expect EBITDA to improve from a loss of $6 million in 2020 to breakeven by 2023."

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*Includes strategic partnerships with Allier Capital, BDA Partners, and Poalim Capital Markets.

William Blair or an affiliate does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. This report is not intended to provide personal investment advice. The opinions and recommendations herein do not take into account individual client circumstances, objectives, or needs and are not intended as recommendations of particular securities, financial instruments, or strategies to particular clients. The recipient of this report must make its own independent decisions regarding any securities or financial instruments mentioned herein.

William Blair or an affiliate was a manager or co-manager of a public offering of equity securities for The Real Good Food Company, Inc. within the prior 12 months.

William Blair or an affiliate is a market maker in the security of The Real Good Food Company, Inc.

William Blair or an affiliate expects to receive or intends to seek compensation for investment banking services from The Real Good Food Company, Inc. or an affiliate within the next three months.

William Blair or an affiliate received compensation for investment banking services or non-investment-banking services from The Real Good Food Company, Inc. within the last 12 months. The Real Good Food Company, Inc. is or was, within the last 12 months, an investment banking client of William Blair & Company and/or one or more of its affiliates.

Officers and employees of William Blair or its affiliates (other than research analysts) may have a financial interest in the securities of The Real Good Food Company, Inc.

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Current Ratings Distribution (as of 11/29/21)

Coverage Universe
Outperform (Buy): 76%
Market Perform (Hold): 23%
Underperform (Sell): 1%

Inv. Banking Relationships*
Outperform (Buy): 33%
Market Perform (Hold): 12%
Underperform (Sell): 0%

* Percentage of companies in each rating category that are investment banking clients, defined as companies for which William Blair has received compensation for investment banking services within the past 12 months.

The compensation of the research analyst is based on a variety of factors, including the quality and accuracy of research, client feedback, contributions to other firm departments, competitive factors, and firm profitability.

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