Thursday, 18 April 2024

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Cal-Maine Foods shares jump as Q4 fiscal results top estimates amid record sales By

© Reuters

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[ad_1] — Cal-Maine Foods reported Tuesday fiscal third-quarter results that beat Wall Street estimates as record sales helped ease the impact of falling egg prices.

Cal-Maine Foods Inc (NASDAQ:) rose more than 8% in premarket trading Wednesday in the wake of the report.

The egg producer reported earnings of $3.01 per share on revenue of $703.1 million, missing analyst estimates of $2.11 on revenue of $603.7M, respectively.

Dozens eggs sold in the quarter swelled to 300.8M in the quarter from 294.4M in the quarter earlier, but at lower prices. The net average selling price per dozen $2.247 in Q2 compared with $3.298 a year earlier. 

“Fueled by strong demand, our total sales volumes (dozens sold) for the quarter were higher than the third quarter of fiscal 2023 and reached a company record,” the company said

For Q3, Cal-Maine Foods will pay a cash dividend of approximately $1.00 per share on May 16 to shareholders on record of May 1. 

In their post-earnings note, Goldman Sachs analysts maintained a Sell rating on CALM, citing expectations that egg market supply/demand will continue to face pressures “from moderating seasonal demand post-Easter and into summer, balanced by continued supply uncertainty posed by HPAI.”

“As of now, prices thus far in FY4Q24 have tracked above our prior forecast, and combined with some additional HPAI supply losses,” they added, urging them to lift their GAAP EPS estimates for the quarter to $2.43, up from the previous $1.98.

“We continue to believe HPAI-induced supply shortfalls and their associated impact on pricing and CALM earnings should not be fully capitalized beyond excess cash generation, particularly as CALM has seen continued growth in net cash balances ($695mn at FY3Q24, or 24% of market cap) that is only generating interest income below the company’s cost of equity,” analysts said.

(Yasin Ebrahim contributed reporting)


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