Why Did Cal-Maine Foods Stock Drop Today?
To find the catalyst, you may have to flip back a few days on your calendar.
Bad news is good news for Cal-Maine
Specifically, flip back to June 6, when the August Egg Company announced a voluntary recall of its brown cage-free and organic brown eggs on worries of salmonella contamination. That recall affected multiple brands of eggs wholesaled by August to retailers, across nine states -- and removed 20.4 million eggs from the market, sparking worries of rising egg prices.
With August out of the market, companies not recalling their eggs -- companies like Cal-Maine Foods -- actually stood to benefit from the salmonella scare. From recall day through yesterday, Cal-Maine's stock price had risen nearly 4%. As worries over a supply deficit recede, however, Cal-Maine may have begun giving back its gains.
Is Cal-Maine stock a buy?
Current shareholders may not be thrilled with today's price decline, but new investors should be -- because it makes the stock even cheaper than it already was.
Valued on trailing-12-month profits, Cal-Maine stock costs a lowly 5 times earnings. And granted, last year's expensive eggs may become cheaper in the future, hurting profits. But based on analyst forecasts for more than $8 a share in earnings next year, Cal-Maine stock remains attractively priced at 12 times forward earnings.
Scramble in a generous 6.6% dividend yield, and Cal-Maine stock looks even more attractive. Unless and until you see eggs at your supermarket getting significantly cheaper, now could be a good time to buy Cal-Maine stock.
Should you invest $1,000 in Cal-Maine Foods right now?
Before you buy stock in Cal-Maine Foods, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Cal-Maine Foods wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $689,813!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $906,556!*
Now, it's worth noting Stock Advisor 's total average return is809% — a market-crushing outperformance compared to175%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor.
See the 10 stocks »
*Stock Advisor returns as of June 23, 2025
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Globe and Mail
17 minutes ago
- Globe and Mail
Nvidia, Palantir, and AMD Have a Nearly $13 Billion Warning for Wall Street -- but Are You Paying Attention?
Key Points Competitive advantages, along with insatiable demand for artificial intelligence (AI) hardware and software, have sent shares of Nvidia, Palantir Technologies, and Advanced Micro Devices soaring. On a combined basis, insiders at Nvidia, Palantir, and AMD have made just four purchases of their respective company's stock spanning five years. Historical precedent poses a big problem for some of Wall Street's hottest AI stocks. 10 stocks we like better than Nvidia › Roughly 30 years ago, the advent and proliferation of the internet began positively altering the growth arc for corporate America. The internet offered businesses new ways to interact with prospective and existing clients, as well as market their products. For decades, investors have been waiting for the next technological leap forward, and the artificial intelligence (AI) revolution looks to be it. The combination of increased productivity and consumption-side effects associated with the rise of AI is expected to increase global gross domestic product by $15.7 trillion come 2030, according to analysts at PwC. This sky-high addressable market is the primary reason we've witnessed Wall Street's AI darlings -- Nvidia (NASDAQ: NVDA), Palantir Technologies (NASDAQ: PLTR), and Advanced Micro Devices (NASDAQ: AMD), which is commonly known as "AMD" -- soar since 2023 began. Nvidia's Hopper (H100) and Blackwell graphics processing units (GPUs) account for the bulk of the GPUs deployed in AI-accelerated data centers. Meanwhile, production for AMD's Instinct series AI-accelerating chips is expanding, with the expectation that it'll carve out a healthy share of the AI-GPU market for enterprise data centers. As for Palantir, its AI- and machine learning-powered software-as-a-service Gotham and Foundry platforms offer sustainable moats. Federal governments turn to Gotham for military mission planning and execution, along with data collection and analysis. Meanwhile, Foundry is a subscription-driven platform for businesses looking to make sense of their big data and streamline/automate their operations. While their respective share price appreciation indicates everything is going great for Nvidia, Palantir, and AMD, all three companies have, collectively, offered up a nearly $13 billion warning to Wall Street. The real question is: Are you, or any other investors, heeding this warning? Nvidia, Palantir, and AMD combine for close to a $13 billion warning There are a number of potential headwinds that can come into play for AI stocks over the coming quarters and years, some of which I'll touch on a bit later. However, one of the more front-and-center concerns has to do with the how corporate insiders have approached their company's stock. Here's the good news: Thanks to required Form 4 filings with the Securities and Exchange Commission, investors have the ability to track the purchasing and selling activity of executives and board members. This activity details the buying and selling of common stock, as well as options activity. When it comes to Nvidia, Palantir, and AMD, there's been a very clear trend over the last five years (note: Palantir's initial public offering was Sept. 30, 2020): insider selling. Over the trailing-five-year period, net selling activity has totaled: More than $4.71 billion for Nvidia. Over $7.43 billion for Palantir. Approximately $762 million for AMD. Collectively, the insiders of these three highly influential AI businesses have sold north of $12.9 billion worth of their common stock over the trailing half-decade. However, insider selling isn't as cut-and-dried as it might appear on the surface. This is to say there are a lot of reasons insiders might sell their company's stock -- and they're not all nefarious. For instance, most executives receive stock-based compensation and/or options. Options are required to be exercised within a certain time frame, otherwise they expire worthless. With some executives receiving the lion's share of their compensation in stock or options, they have to sell their company's stock to cover their federal and/or state tax bill. The key point here is that not all insider selling is necessarily bad. But at the same time, there's only one reason executives and board members purchase their company's stock: they expect it to head higher. Over the trailing five-year period, executives and board members have made exactly one purchase at Nvidia, one purchase at Palantir, and two purchases at AMD. The takeaway here is simple: if insiders at Nvidia, Palantir, and AMD aren't willing to purchase their own company's stock, why should everyday investors believe these three stocks still offer significant upside? Insider activity isn't the only concern Unfortunately, this nearly $13 billion warning isn't the only worry for investors. Historical precedent is a multipronged headwind that has the potential to meaningfully drag down AI stock valuations. To preface the following discussion, history is never guaranteed to repeat on Wall Street. If there was an indicator that concretely guaranteed short-term directional moves in stocks, you can rest assured that everyone would be using it by now. Nevertheless, there are historical events and metrics that have flawlessly correlated with directional moves for the S&P 500 and Wall Street's other major indexes in the past. It's these correlations that suggest Nvidia, Palantir, and AMD could be in a world of trouble. For example, every game-changing innovation since (and including) the advent of the internet in the mid-1990s has endured a bubble-bursting event fairly early in its expansion. This long line of hyped innovations navigating their way through bubbles signals that investors consistently overestimate the utility and early stage adoption of new technologies. Although spending on AI infrastructure has been robust, as Nvidia's and AMD's operating results suggest, most businesses have yet to optimize their AI solutions or generate a positive return on their AI investments. It's unlikely that artificial intelligence will avoid the fate of previous next-big-thing trends. The other area where historical precedent comes into play is valuations. Though AMD's valuation isn't egregiously high, the same can't be said for Nvidia or Palantir, which are butting heads with history. Before the bursting of the dot-com bubble a quarter of a century ago, businesses on the leading edge of the internet revolution consistently peaked at around 30 to 40 times trailing-12-month sales. As of this writing on Aug. 12, Nvidia is tipping the scales at a price-to-sales (P/S) ratio of nearly 31, while Palantir's P/S ratio is 137, which is the highest I've ever witnessed for a megacap company in 27 years of investing. While both companies offer competitive advantages that are worthy of valuation premiums, history is quite clear that extended premiums of this magnitude aren't sustainable over the long run. Between persistent insider selling, a virtual lack of insider buying, and mounting historical headwinds, the risk-versus-reward pendulum for Nvidia, Palantir, and AMD has undeniably swung toward "risk." Should you invest $1,000 in Nvidia right now? Before you buy stock in Nvidia, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $649,544!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,113,059!* Now, it's worth noting Stock Advisor's total average return is 1,062% — a market-crushing outperformance compared to 185% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 13, 2025
Globe and Mail
2 hours ago
- Globe and Mail
How CIRO's new guidance for DIY investing compares with proposals from U.K. regulator
The growth of online investing has introduced millions of new investors to markets, but they're not always using the best information when making investment decisions. Regulators in Canada and elsewhere have raised concerns about do-it-yourself (DIY) investors relying on unregulated advice from social media and so-called 'finfluencers,' sometimes resulting in high-risk investments. Part of the issue is how advice is regulated. Online investing platforms are restricted from making recommendations, as self-directed investors haven't undergone suitability assessments. The Canadian Investment Regulatory Organization (CIRO) took a step toward changing that this week. As Kelsey Rolfe reported, CIRO's proposed guidance (which is out for consultation until Nov. 10) narrows the definition of 'recommendation' significantly to communication that 'endorses a specific investment decision for the client.' That means order-execution-only dealers will be allowed to provide 'decision-making supports' to DIY investors. These include tools to help find securities that align with an investor's strategies and goals, and sample portfolios that help with asset allocation (without mentioning specific investment products). The U.K. regulator is looking to go a step further. In June, the Financial Conduct Authority (FCA) released its own proposals that would allow firms to offer free, 'targeted support' to groups of investors with common characteristics. For example, firms are currently allowed to suggest to a consumer that they're in a position to invest; under targeted support, the firm would be allowed to suggest a specific investment product. For those already investing, firms would be able to not only flag risky investments and offer explanatory materials, but suggest an alternative product. Similarly, when an investor holds an expensive fund, firms would be allowed to suggest a product that costs less. As with CIRO, the proposed change revolves around online investing platforms making recommendations. To adopt the proposals, the U.K.'s Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 would need to be amended to create a new specified activity of 'targeted support,' different from existing forms of advice. With investing becoming easier and cheaper, it makes sense for better information to be more available, too. But what does this mean for advisors? CIRO said in its initial consultation that it doesn't want to 'diminish the value' of the full-service advice channel. The FCA makes it clear that the targeted support proposal is a compromise: not as beneficial as more personalized advice, but a worthwhile tradeoff in the absence of support. And research has shown that most DIY investors want advice from a human at some point. Still, the proposed changes raise the bar ever so slightly, putting more pressure on advisors whose practices are built on investment recommendations without offering the personalized financial, tax and estate planning that isn't available cheaply and generically. A perfect storm: The wealth management industry is experiencing an unprecedented wave of consolidation. Combined with aging advisors behind on their succession planning, the result is a perfect storm of capital, urgency and opportunity, writes Joe Millott of Fort Capital Partners. What's in a name? In June, the Investment Industry Association of Canada (IIAC) changed its name to the Canadian Forum for Financial Markets (CFFiM). As Rudy Mezzetta reports, the move follows other rebrands from major industry organizations in the past two years, and the entrance of a new competitor. Sage advice: For money manager Paul Harris, investing is akin to meditation, especially when markets are as volatile as they've been lately. 'When you meditate, you're supposed to let things happen and not react. It's the same kind of philosophy I have with investing, which is to just absorb what's happening, because often it's only short-term,' says Mr. Harris, a partner and portfolio manager at Toronto-based Harris Douglas Asset Management Inc. Here's what he's buying and selling. Fraud risk: In early January, Megan Tong lost around $70,000 after hackers logged into one of her self-directed investment accounts, cashed in all her holdings and briefly bought and sold tens of thousands of dollars worth of two Chinese stocks. But Ms. Tong's discount brokerage, Questrade Financial Group Inc., has declined to reimburse her for most of the loss, saying it didn't result from a breach of its system, writes Erica Alini. Tax risk: Rental property owners should be aware of how the Canada Revenue Agency treats rentals to friends or relatives. As Tim Cestnick explains, a recent court decision highlights some potential red flags. Tariff risk: Canadians have been bracing for price hikes from U.S. tariffs. While some things have gotten more expensive, Mariya Postelnyak reports, not all the price spikes have been as high as anticipated, and some prices have held steady or fallen.
CTV News
4 hours ago
- CTV News
CTV National News: Here's what passengers should know if their flight is cancelled
Watch Adrian Ghobrial reports on what is legally required from Air Canada when it comes to handling cancelled flights if a strike is called.
