Freshpet (FRPT) offers an "attractive" entry point after a recent sell-off in its shares following a Q1 beat and slightly raised 2026 topline, Morgan Stanley said in a note Wednesday.

"Recent sell-off presents an attractive entry point in a strong secular growth story with concerns around competition, macros, and costs fair but overdone," the report said.

The note pointed to inability to disprove the Costco (COST) private label risk, incremental cost pressure, and sensitivity to a consumer slowdown as among the catalysts for the pushback.

Those concerns are fair in the short-term, but its top-line and EBITDA momentum is strong, and the private label risk will likely be less than feared, the report said.

Costco, which launched its Kirkland fresh dog food in March, represents about 10% of Freshpet's revenue, the note said.

Morgan Stanley kept its overweight rating while cutting its price target to $77 from $90, citing a compression in peer multiples.

Price: 56.95, Change: +2.02, Percent Change: +3.68