As the Q3 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the perishable food industry, including Pilgrim's Pride (NASDAQ:PPC) and its peers.
The perishable food industry is diverse, encompassing large-scale producers and distributors to specialty and artisanal brands. These companies sell produce, dairy products, meats, and baked goods and have become integral to serving modern American consumers who prioritize freshness, quality, and nutritional value. Investing in perishable food stocks presents both opportunities and challenges. While the perishable nature of products can introduce risks related to supply chain management and shelf life, it also creates a constant demand driven by the necessity for fresh food. Companies that can efficiently manage inventory, distribution, and quality control are well-positioned to thrive in this competitive market. Navigating the perishable food industry requires adherence to strict food safety standards, regulations, and labeling requirements.
The 11 perishable food stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 9.3%.
While some perishable food stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.7% since the latest earnings results.
Pilgrim's Pride (NASDAQ:PPC)
Offering everything from pre-marinated to frozen chicken, Pilgrim’s Pride (NASDAQ:PPC) produces, processes, and distributes chicken products to retailers and food service customers.Pilgrim's Pride reported revenues of $4.58 billion, up 5.2% year on year. This print fell short of analysts’ expectations by 2.2%, but it was still a strong quarter for the company with an impressive beat of analysts’ gross margin estimates and a solid beat of analysts’ EBITDA estimates.
“Throughout the quarter, we continued to emphasize operational excellence, diversify our portfolio and cultivate partnerships with Key Customers to drive value for the consumer. Our unrelenting focus on quality, service and innovation is reflected in our performance,” said Fabio Sandri, Pilgrim’s President and Chief Executive Officer.
Pilgrim's Pride delivered the weakest performance against analyst estimates of the whole group. Unsurprisingly, the stock is down 2.7% since reporting and currently trades at $46.46.
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Best Q3: Mission Produce (NASDAQ:AVO)
Founded in 1983 in California, Mission Produce (NASDAQ:AVO) grows, packages, and distributes avocados.Mission Produce reported revenues of $354.4 million, up 37.4% year on year, outperforming analysts’ expectations by 63.5%. The business had an incredible quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ gross margin estimates.
Mission Produce scored the biggest analyst estimates beat among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 3.4% since reporting. It currently trades at $11.90.
Weakest Q3: Calavo (NASDAQ:CVGW)
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.Calavo reported revenues of $170 million, up 19.5% year on year, exceeding analysts’ expectations by 5%. Still, it was a softer quarter as it posted a significant miss of analysts’ EBITDA and gross margin estimates.
As expected, the stock is down 2.2% since the results and currently trades at $23.64.
Tyson Foods (NYSE:TSN)
Started as a simple trucking business, Tyson Foods (NYSE:TSN) is one of the world’s largest producers of chicken, beef, and pork.Tyson Foods reported revenues of $13.57 billion, up 1.6% year on year. This result topped analysts’ expectations by 1%. Overall, it was an exceptional quarter as it also logged an impressive beat of analysts’ gross margin estimates and a solid beat of analysts’ EBITDA estimates.
The stock is down 5.3% since reporting and currently trades at $55.69.
Beyond Meat (NASDAQ:BYND)
A pioneer at the forefront of the plant-based protein revolution, Beyond Meat (NASDAQ:BYND) is a food company specializing in alternatives to traditional meat products.Beyond Meat reported revenues of $81.01 million, up 7.6% year on year. This number surpassed analysts’ expectations by 1%. More broadly, it was a satisfactory quarter as it also logged an impressive beat of analysts’ EBITDA estimates.
Beyond Meat had the weakest full-year guidance update among its peers. The stock is down 40.7% since reporting and currently trades at $3.90.
Market Update
Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% each in November and December), and a notable surge followed Donald Trump's presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by the pace and magnitude of future rate cuts as well as potential changes in trade policy and corporate taxes once the Trump administration takes over. The path forward is marked by uncertainty.Want to invest in winners with rock-solid fundamentals? Check out our and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
This content was originally published on Stock Story
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