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Yahoo
3 days ago
- Business
- Yahoo
Who's Winning the Avocado Clash: Mission Produce or Calavo Growers?
In the fast-growing world of fresh produce, no fruit has captured the market's imagination quite like the avocado, and two names stand out in the race to dominate the global supply chain — Mission Produce Inc. AVO and Calavo Growers Inc. CVGW. Both companies have carved out powerful positions in the avocado industry, but their strategies, scale and market approaches set them on distinctly different face-off takes you inside the competitive dynamics between these two avocado titans, comparing their market shares, positioning and business models. AVO leans on a vertically integrated, global footprint with a sharp focus on operational efficiency and international sourcing. Then again, CVGW blends avocado distribution with a broader portfolio that includes value-added fresh foods and prepared consumer demand for healthy, fresh options continues to rise and global supply chains grow more complex, the question arises: Which company is better positioned to scale, adapt and lead in the premium produce category? Join us as we unpack the strengths, strategies, and prospects of AVO and CVGW in this all-green battle for avocado dominance. AVO continues to cement its position as a global leader in the avocado industry, attracting investor interest with its scale, strategic clarity and consistent execution. The company opened fiscal 2025 with strong momentum, driven by impressive gains in its Marketing & Distribution segment despite supply disruptions in Mexico, its primary sourcing region. This performance underscores Mission Produce's agility in navigating market volatility while maintaining pricing power and meeting rising consumer demand. With sourcing operations across Mexico, Peru, Colombia and Guatemala, AVO commands a meaningful share of the global avocado supply and is steadily expanding into complementary high-growth categories like blueberries and the core of Mission Produce's growth strategy is its vertically integrated model, diversified sourcing, and product expansion. Its multi-category portfolio, anchored by health-forward staples, positions the company to benefit from long-term consumer trends. AVO is investing heavily in infrastructure, including new acreage for blueberries and a growing mango program, as well as optimizing its North American distribution network for cost efficiency. This operational flexibility allows Mission Produce to shift sourcing when needed, ensuring service continuity and reinforcing its reputation as a reliable, high-quality supplier in a competitive the financial front, AVO is showing disciplined, profitable growth. Adjusted earnings and EBITDA have improved, backed by strong asset utilization and expanding farming operations. The company is also investing in digital innovation to enhance efficiency across its logistics and supply chain. However, tariff uncertainties remain a variable, especially given Mexico's central role in sourcing. Temporary tariffs earlier this year created margin pressure and underscored the value of Mission Produce's global diversification. With alternative sourcing regions like Peru, Colombia and others, and a resilient supply network, the company is well-equipped to absorb geopolitical shocks, strengthening its case as a long-term growth player in the global produce sector. CVGW, a long-established leader in the avocado and fresh food space, is making a strong comeback with a sharpened focus on profitability, margin expansion and operational efficiency. In its latest quarter, the company delivered its best first-quarter adjusted net income since 2019, signaling a turning point after years of restructuring. The Fresh segment, led by avocados, saw a significant surge in profitability despite a slight dip in volume, driven largely by stronger average pricing and lower fruit costs. This pricing power reflects Calavo Growers' deep industry relationships and disciplined sourcing strategy. As a major player in the avocado market, CVGW's influence remains critical, with its branded products and private-label offerings reaching a broad base of retail and foodservice sets Calavo Growers apart is its dual-segment portfolio, combining its core Fresh segment with a stable, if challenged, Prepared segment that includes ready-to-eat guacamole and fresh-cut fruit. While the Prepared segment faced margin pressure in first-quarter fiscal 2025, it remains a strategic lever as convenience trends grow. The Calavo brand itself stands for freshness, trust and health, resonating especially with health-conscious, time-strapped by a vertically integrated supply chain and long-standing grower partnerships, CVGW continues to strengthen its operational backbone. The company's targeted cost discipline, evidenced by a significant drop in SG&A expenses, and a tripling of adjusted EBITDA, underscores its renewed commitment to sustainable others in the produce industry, CVGW faces uncertainty regarding tariff dynamics, particularly regarding Mexican avocado imports. While tariffs briefly posed additional cost pressures, the company's management remains confident that the nutritional value and affordability of avocados will preserve demand resilience. More importantly, Calavo Growers' long-standing sourcing presence in Mexico, paired with adaptive pricing and logistics strategies, offers it a buffer against short-term disruptions. With a strong balance sheet, growing momentum, and a clear focus on shareholder value, CVGW is emerging as a streamlined, high-potential investment in the evolving global produce landscape. The Zacks Consensus Estimate for Mission Produce's fiscal 2025 sales and EPS implies year-over-year declines of 6.6% and 32.4%, respectively. EPS estimates have been unchanged in the past 30 days. AVO's annual sales and earnings are slated to decrease 3.2% and 6% year over year, respectively, in fiscal 2026. Image Source: Zacks Investment Research The Zacks Consensus Estimate for Calavo Growers' fiscal 2025 sales and EPS suggests year-over-year growth of 7.2% and 78.1%, respectively. EPS estimates have been unchanged in the past 30 days. CVGW's annual sales and earnings are slated to increase 5.1% and 24.1% year over year, respectively, in fiscal 2026. Image Source: Zacks Investment Research Mission Produce and Calavo Growers have experienced stable estimates in the past 30 days. However, CVGW holds an edge, supported by stronger projected year-over-year sales and EPS growth, compared with the anticipated year-over-year declines in Mission Produce's sales and EPS. In the past three months, the CVGW stock had the edge in terms of performance, having recorded a total return of 16.8%. This has noticeably outpaced the benchmark S&P 500's return of 1.2% and AVO's 12.3% decline. Image Source: Zacks Investment Research From a valuation perspective, Mission Produce trades at a forward price-to-earnings (P/E) multiple of 26.89X, which is above its 5-year median of 20.5X. Moreover, the AVO stock trades above Calavo Growers' forward 12-month P/E multiple of 12.49X and a 5-year median of 21.87X. Image Source: Zacks Investment Research At current levels, CVGW appears attractively priced relative to AVO, offering a compelling case for value-focused investors. While Calavo Growers' lower valuation may reflect lingering market skepticism, it suggests an opportunity the market has yet to fully recognize, particularly considering the company's recent operational turnaround. With improving profitability, expanding margins and disciplined cost management, Calavo Growers is demonstrating meaningful progress that supports a stronger earnings outlook without the elevated price contrast, AVO trades at more than double Calavo's current forward P/E multiple and sits above its 5-year median, signaling a valuation that already reflects much of its growth potential. While Mission Produce's premium is supported by its global sourcing footprint, multi-category strategy and digital innovation, the stock leaves less room for upside surprises and offers less of a cushion in a volatile market this dynamic, CVGW offers a more favorable risk-reward profile, especially for investors seeking exposure to the avocado sector with a margin of safety. With a well-known brand, stabilized operations, and improving financial performance, Calavo Growers' undervalued stock could represent a more prudent and timely entry point, particularly as valuation discipline becomes increasingly important in today's market. Calavo Growers emerges as the more compelling pick, particularly for investors seeking a balanced blend of value and growth. While Mission Produce stands out for its global footprint and diversified category strategy, Calavo Growers' recent performance suggests a company on the a robust three-month return, a leaner cost structure and clear signs of a successful operational turnaround, CVGW is capturing attention not just for what it is today but also for where it is headed. Its significantly lower valuation, especially when compared with AVO's premium pricing, underscores the market's relative underappreciation, offering an attractive entry to CVGW's appeal is the positive momentum in analyst sentiment. Positive forward estimates signal growing confidence in the company's earnings potential, suggesting the turnaround is not only real but sustainable. While AVO may offer long-term strategic advantages through diversification and scale, CVGW currently presents a more favorable risk-reward investors focused on capitalizing on both recovery and value, Calavo Growers is making a strong case as the stock to watch in the avocado space. AVO and CVGW currently carry a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Calavo Growers, Inc. (CVGW) : Free Stock Analysis Report Mission Produce, Inc. (AVO) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Effettua l'accesso per consultare il tuo portafoglio
Yahoo
08-05-2025
- Business
- Yahoo
1 Consumer Stock with Impressive Fundamentals and 2 to Avoid
Consumer staples stocks are solid insurance policies in frothy markets ripe for corrections. But recently, the industry has failed to do its job as it shed 14% over the past six months. This drawdown was worse than the S&P 500's 6.2% fall. Despite the lackluster result, a few diamonds in the rough can produce earnings growth no matter what, and we started StockStory to help you find them. Keeping that in mind, here is one consumer stock poised to generate sustainable market-beating returns and two we're steering clear of. Market Cap: $464.5 million A trailblazer in the avocado industry, Calavo Growers (NASDAQ:CVGW) is a pioneering California-based provider of high-quality avocados and other fresh food products. Why Does CVGW Fall Short? Products have few die-hard fans as sales have declined by 14.7% annually over the last three years Smaller revenue base of $688.3 million means it hasn't achieved the economies of scale that some industry juggernauts enjoy Gross margin of 10.6% is below its competitors, leaving less money to invest in areas like marketing and production facilities Calavo's stock price of $25.82 implies a valuation ratio of 15.3x forward P/E. Dive into our free research report to see why there are better opportunities than CVGW. Market Cap: $432.1 million Founded in 2013, Tilray Brands (NASDAQ:TLRY) engages in cannabis research, cultivation, and distribution, offering a range of medical and recreational cannabis products, hemp-based foods, and alcoholic beverages. Why Should You Sell TLRY? Expenses have increased as a percentage of revenue over the last year as its operating margin fell by 70.1 percentage points Long-term business health is up for debate as its cash burn has increased over the last year Negative returns on capital show management lost money while trying to expand the business, and its decreasing returns suggest its historical profit centers are aging Tilray is trading at $0.43 per share, or 5.5x forward EV-to-EBITDA. If you're considering TLRY for your portfolio, see our FREE research report to learn more. Market Cap: $3.85 billion With licenses to produce colognes and perfumes under brands such as Kate Spade, Van Cleef & Arpels, and Abercrombie & Fitch, Inter Parfums (NASDAQ:IPAR) manufactures and distributes fragrances worldwide. Why Will IPAR Beat the Market? Remarkable 16.3% revenue growth over the last three years demonstrates its ability to capture significant market share Products command premium prices and lead to a top-tier gross margin of 55.6% Free cash flow margin jumped by 11.3 percentage points over the last year, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends At $119.71 per share, Inter Parfums trades at 21.6x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it's free. Donald Trump's victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs. While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like United Rentals (+322% five-year return). Find your next big winner with StockStory today for free. Sign in to access your portfolio
Yahoo
02-05-2025
- Business
- Yahoo
1 Cash-Heavy Stock to Research Further and 2 to Steer Clear Of
Companies with more cash than debt can be financially resilient, but that doesn't mean they're all strong investments. Some lack leverage because they struggle to grow or generate consistent profits, making them unattractive borrowers. Just because a business has cash doesn't mean it's a good investment. Luckily, StockStory is here to help you separate the winners from the losers. Keeping that in mind, here is one company with a net cash position that balances growth with stability and two best left off your watchlist. Net Cash Position: $99.12 million (58% of Market Cap) Founded by a team of former gaming industry executives, PlayStudios (NASDAQ:MYPS) offers free-to-play digital casino games. Why Do We Avoid MYPS? Products and services fail to spark excitement with consumers, as seen in its flat sales over the last two years Poor expense management has led to operating losses Incremental sales over the last four years were much less profitable as its earnings per share fell by 41.4% annually while its revenue grew PlayStudios is trading at $1.28 per share, or 2.4x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including MYPS in your portfolio, it's free. Net Cash Position: $19.66 million (4.1% of Market Cap) A trailblazer in the avocado industry, Calavo Growers (NASDAQ:CVGW) is a pioneering California-based provider of high-quality avocados and other fresh food products. Why Does CVGW Worry Us? Sales tumbled by 14.7% annually over the last three years, showing consumer trends are working against its favor Revenue base of $688.3 million puts it at a disadvantage compared to larger competitors exhibiting economies of scale Gross margin of 10.6% is below its competitors, leaving less money to invest in areas like marketing and production facilities At $27.02 per share, Calavo trades at 15.8x forward P/E. Check out our free in-depth research report to learn more about why CVGW doesn't pass our bar. Net Cash Position: $435.7 million (9.4% of Market Cap) Started by René Lacerte in 2006 after selling his previous payroll and accounting software company PayCycle to Intuit, (NYSE:BILL) is a software as a service platform that aims to make payments and billing processes easier for small and medium-sized businesses. Why Could BILL Be a Winner? Average billings growth of 17.6% over the last year enhances its liquidity and shows there is steady demand for its products Prominent and differentiated software culminates in a best-in-class gross margin of 85.1% Operating profits increased over the last year as the company gained some leverage on its fixed costs and became more efficient stock price of $45.25 implies a valuation ratio of 3.1x forward price-to-sales. Is now a good time to buy? Find out in our full research report, it's free. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Sterling Infrastructure (+1,096% five-year return). Find your next big winner with StockStory today for free. Sign in to access your portfolio
Yahoo
29-04-2025
- Business
- Yahoo
3 Dawdling Stocks in the Doghouse
A stock with low volatility can be reassuring, but it doesn't always mean strong long-term performance. Investors who prioritize stability may miss out on higher-reward opportunities elsewhere. Luckily for you, StockStory helps you navigate which companies are truly worth holding. Keeping that in mind, here are three low-volatility stocks that don't make the cut and some better opportunities instead. Rolling One-Year Beta: 0.70 A trailblazer in the avocado industry, Calavo Growers (NASDAQ:CVGW) is a pioneering California-based provider of high-quality avocados and other fresh food products. Why Are We Wary of CVGW? Annual sales declines of 14.7% for the past three years show its products struggled to connect with the market Revenue base of $688.3 million puts it at a disadvantage compared to larger competitors exhibiting economies of scale Easily substituted products (and therefore stiff competition) result in an inferior gross margin of 10.6% that must be offset through higher volumes At $26.73 per share, Calavo trades at 15.7x forward price-to-earnings. Dive into our free research report to see why there are better opportunities than CVGW. Rolling One-Year Beta: -0.01 With a history that goes back more than a century, PepsiCo (NASDAQ:PEP) is a household name in food and beverages today and best known for its flagship soda. Why Do We Think Twice About PEP? Scale is a double-edged sword because it limits the company's growth potential compared to its smaller competitors, as reflected in its below-average annual revenue increases of 4.2% for the last three years Falling unit sales over the past two years imply it may need to invest in product improvements to get back on track Estimated sales growth of 2% for the next 12 months implies demand will slow from its three-year trend PepsiCo is trading at $133.65 per share, or 16x forward price-to-earnings. Check out our free in-depth research report to learn more about why PEP doesn't pass our bar. Rolling One-Year Beta: 0.55 With a fleet of trucks making weekly deliveries to over 300,000 customer locations, UniFirst (NYSE:UNF) provides, rents, cleans, and maintains workplace uniforms and protective clothing for businesses across various industries. Why Do We Think UNF Will Underperform? Sales are projected to remain flat over the next 12 months as demand decelerates from its two-year trend Incremental sales over the last five years were much less profitable as its earnings per share fell by 2.7% annually while its revenue grew ROIC of 7.3% reflects management's challenges in identifying attractive investment opportunities, and its falling returns suggest its earlier profit pools are drying up UniFirst's stock price of $178.09 implies a valuation ratio of 22x forward price-to-earnings. To fully understand why you should be careful with UNF, check out our full research report (it's free). The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Comfort Systems (+751% five-year return). Find your next big winner with StockStory today for free.
Yahoo
25-04-2025
- Business
- Yahoo
1 Profitable Stock with Exciting Potential and 2 to Brush Off
A company with profits isn't always a great investment. Some struggle to maintain growth, face looming threats, or fail to reinvest wisely, limiting their future potential. Not all profitable companies are created equal, and that's why we built StockStory - to help you find the ones that truly shine bright. That said, here is one profitable company that leverages its financial strength to beat the competition and two best left off your watchlist. Trailing 12-Month GAAP Operating Margin: 3.6% A trailblazer in the avocado industry, Calavo Growers (NASDAQ:CVGW) is a pioneering California-based provider of high-quality avocados and other fresh food products. Why Are We Hesitant About CVGW? Annual sales declines of 14.7% for the past three years show its products struggled to connect with the market Smaller revenue base of $688.3 million means it hasn't achieved the economies of scale that some industry juggernauts enjoy Gross margin of 10.6% is below its competitors, leaving less money to invest in areas like marketing and production facilities Calavo is trading at $26.82 per share, or 16x forward price-to-earnings. To fully understand why you should be careful with CVGW, check out our full research report (it's free). Trailing 12-Month GAAP Operating Margin: 3.8% Best known for its fruit jams and spreads, J.M Smucker (NYSE:SJM) is a packaged foods company whose products span from peanut butter and coffee to pet food. Why Does SJM Fall Short? Muted 3.7% annual revenue growth over the last three years shows its demand lagged behind its consumer staples peers Sales are projected to remain flat over the next 12 months as demand decelerates from its three-year trend Underwhelming 4.1% return on capital reflects management's difficulties in finding profitable growth opportunities, and its decreasing returns suggest its historical profit centers are aging At $116.98 per share, J. M. Smucker trades at 11.4x forward price-to-earnings. If you're considering SJM for your portfolio, see our FREE research report to learn more. Trailing 12-Month GAAP Operating Margin: 12.6% With a focus on the CFM56 engine that powers Boeing and Airbus's planes, FTAI Aviation (NASDAQ:FTAI) sells, leases, maintains, and repairs aircraft engines. Why Will FTAI Outperform? Annual revenue growth of 56.5% over the past two years was outstanding, reflecting market share gains this cycle Additional sales over the last two years increased its profitability as the 102% annual growth in its earnings per share outpaced its revenue Cash-burning tendencies have improved over the last five years, showing it could become financially independent one day FTAI Aviation's stock price of $101 implies a valuation ratio of 22.7x forward price-to-earnings. Is now a good time to buy? Find out in our full research report, it's free. Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Comfort Systems (+751% five-year return). Find your next big winner with StockStory today for free. Sign in to access your portfolio
