Time To Buy The Dip In Simply Good Foods Stock?
Simply Good Foods (SMPL) stock has fallen by 15.9% in less than a month, from $17.06 on 27th Feb, 2026 to $14.35 now. Should you buy this dip?
Dip buying is a viable strategy for quality stocks that have a history of recovering from dips. As it turns out, SMPL stock passes basic quality checks. But the bad news is that historically, the median return for the 12-month period following sharp dips was -0.03%, with median peak return of 21%. We define sharp dip as stock going down 20% or more, in less than 30 day period.
Below, we get into details of historical dips and subsequent returns.
Historical Median Returns Post Dips
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| Period | Past Median Return |
|---|---|
| 1M | -6.5% |
| 3M | -4.4% |
| 6M | 0.9% |
| 12M | -0.0% |
Historical Dip-Wise Details
SMPL had 6 events since 9/10/2014 where the dip threshold of -20% within 30 days was triggered
- 21% median peak return within 1 year of dip event
- 91 days is the median time to peak return after a dip event
- -19% median max drawdown within 1 year of dip event
| 30 Day Dip | SMPL Subsequent Performance | |||||||
|---|---|---|---|---|---|---|---|---|
| Date | SMPL | SPY | 1Y | Peak Return |
Max Drop |
# Days to Peak |
||
| Median | -0% | 21% | -19% | 91 | ||||
| 2132026 | -21% | -0% | -10% | 9% | -13% | 11 | ||
| 10062025 | -21% | 4% | -39% | 7% | -41% | 15 | ||
| 8092022 | -20% | 6% | 10% | 21% | -11% | 115 | ||
| 3032020 | -23% | -10% | 49% | 58% | -24% | 303 | ||
| 10242019 | -21% | 0% | -11% | 20% | -38% | 67 | ||
| 7102017 | -26% | 1% | 41% | 41% | -7% | 365 | ||
1Y Refers to 1 year or time since recent dip, whichever is smaller
Simply Good Foods Passes Basic Financial Quality Checks
Revenue growth, profitability, cash flow, and balance sheet strength need to be evaluated to reduce the risk of a dip being the sign of a deteriorating business situation.
| Quality Metrics | Value | Quality Check |
|---|---|---|
| Revenue Growth (LTM) | 6.3% | Pass |
| Revenue Growth (3-Yr Avg) | 6.9% | Pass |
| Operating Cash Flow Margin (LTM) | 13.6% | Pass |
| Leverage (see below) | – | Pass |
| => Interest Coverage Ratio | 7.2 | |
| => Cash To Interest Expense Ratio | 9.9 |
Not sure if you can take a call on SMPL stock? Consider portfolio approach
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Single stocks swing wildly but staying invested matters. A well built portfolio helps you stay invested, captures upside and softens the blows from individual stocks.
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