Core Viewpoint - Mission Produce, Inc. will release its financial results for the fiscal second quarter ended April 30, 2025, on June 5, 2025, after market close, followed by a conference call to discuss the results [1]. Group 1: Financial Results Announcement - The financial results will be released after market closes on June 5, 2025 [1]. - A conference call and webcast will be held at 5:00 PM Eastern Time on the same day to discuss the financial results [1]. Group 2: Conference Call Details - The conference call can be accessed live by dialing (877) 407-9039 for domestic callers and (201) 689-8470 for international callers [2]. - A replay of the call will be available until June 19, 2025, with specific dialing instructions for both domestic and international callers [2]. Group 3: Company Overview - Mission Produce is a global leader in the avocado business, also offering mangos and blueberries, and has been in operation since 1983 [4]. - The company services retail, wholesale, and foodservice customers in over 25 countries and operates four packing facilities in key growing locations [4]. - Mission Produce has a vertically integrated supply chain and a global distribution network, providing year-round supply of premium fruit [4].

Core Viewpoint - Mission Produce Inc. (AVO) is facing significant downward pressure on its share price due to supply-chain disruptions in Mexico and tariff uncertainties, leading to volatility in the market [1][15][17]. Group 1: Stock Performance - Over the past three months, AVO shares have declined by 12.1%, underperforming the Agricultural - Operations industry and Consumer Staples sector, which grew by 5.2% and 2.3%, respectively [2]. - AVO's current stock price is $10.77, which is 12.9% above its 52-week low of $9.54 but 29.4% below its 52-week high of $15.25, indicating potential upside [6]. - The stock trades above its 50-day moving average and below its 200-day moving average, reflecting mixed market sentiment [6][7]. Group 2: Valuation Concerns - AVO's forward 12-month price-to-earnings (P/E) ratio is 26.7X, significantly higher than the industry average of 15.54X, raising concerns about its valuation [8][10]. - The price-to-sales ratio of 0.68X is also above the industry's 0.46X, suggesting that AVO may not be a strong value proposition at current levels [9]. - Compared to peers like Archer Daniels, Calavo Growers, and Corteva, which have lower P/E ratios, AVO appears overvalued [10][11]. Group 3: Operational Challenges - AVO is experiencing sourcing constraints due to anticipated tightening of avocado supply from Mexico, which is critical to its procurement strategy [15]. - The company plans to increase volumes from California and Peru to offset the Mexican supply dip, but this transition may introduce logistical complexities [16]. - Broader geopolitical uncertainties, including tariff threats, have added to the volatility in AVO's supply chain [17]. Group 4: Growth Potential - The Peruvian blueberry segment is projected to see a 35-40% increase in harvest volume, although average selling prices have declined by 33% year-over-year [18][19]. - AVO's strategic sourcing diversification and investment in Latin America enhance its sourcing flexibility and regional risk management [25]. - Global demand for avocados is rising, driven by health-conscious consumers, positioning AVO to capitalize on this growth despite near-term challenges [26]. Group 5: Long-Term Outlook - AVO's robust global sourcing network and integrated operational model provide a competitive advantage for long-term success [22][23]. - The company achieved a 25% year-over-year increase in average selling prices for avocados in the first quarter of fiscal 2025, indicating strong demand [24]. - AVO's proactive diversification and supply-chain agility are expected to support sustained profitability and market leadership [26].

Company Overview - Mission Produce, Inc (NASDAQ: AVO) is engaged in sourcing, producing, and distributing fresh avocados and other fruits, with operations in the United States and internationally [1] Business Model - The company operates a vertically integrated model, which allows it to provide healthy plant-based food options to consumers [1]

Core Viewpoint - Mission Produce, Inc. has appointed Michael Bryan Sims as an independent Class I director to its board, effective May 5, 2025, increasing the board size from eight to nine directors [1]. Company Overview - Mission Produce is a global leader in sourcing, producing, and distributing fresh Hass avocados, with additional offerings in mangos and blueberries. The company has been operational since 1983 and serves customers in over 25 countries [7]. - The company operates four state-of-the-art packing facilities in key growing locations, including California, Mexico, Peru, and Guatemala, and has sourcing capabilities in several other countries, ensuring a year-round supply of premium fruit [7]. Appointment of Michael Bryan Sims - Michael Bryan Sims brings over four decades of experience in leading global organizations in the food, agriculture, and consumer industries, with a strong background in operational, strategic, and financial expertise [3]. - Sims has previously served as Executive Vice President and CFO of TruGreen, where he led financial restructurings and operational improvements. He also held senior roles at AdvancePierre Foods and Chiquita Brands International [4]. - In addition to his executive experience, Sims serves on the boards of The Hain Celestial Group and Winland Foods, providing strategic and financial oversight [5]. Expectations from the Appointment - The CEO of Mission Produce, Steve Barnard, expressed confidence that Sims' financial background and board-level experience will enhance the company's growth strategies and create sustainable value [6]. - Sims stated that he is honored to join the board and aligns with Mission's commitment to operational excellence and supply chain transparency, looking forward to supporting the company's growth [6].

Core Insights - Mission Produce, Inc. has inaugurated a new packinghouse in Guatemala, enhancing its global sourcing network for avocados and marking a significant development in the country's avocado production capabilities [1][2][3] Company Developments - The new facility is set to launch in August 2025 and is designed with advanced quality assurance and food safety technologies to ensure high standards for avocado distribution [2][3] - Mission Produce has been vertically integrated in Guatemala since 2020, with plans to expand its planted area from 728 hectares to up to 1,000 hectares by 2026 [3] Industry Context - Guatemala is emerging as a key player in the global avocado market, with the potential to meet increasing global demand due to its optimal growing conditions and two annual harvests [2][3] - In 2024, avocado exports from Guatemala generated over Q120,761,773 (USD$15.5 million) and supported more than 6,000 jobs, highlighting the economic impact of the avocado sector [2]

Core Industry Insights - The Zacks Agriculture – Operations industry is benefiting from ongoing innovation and increasing consumer demand for health-focused products, particularly alternative proteins [1][2] - Advancements in food processing technologies, improved grain-handling methods, and expanded storage capacity are supporting industry momentum [2] - The U.S. Department of Agriculture projects agricultural exports of $170.5 billion for fiscal 2025, driven by stronger grain and feed exports [6] Company Highlights Mission Produce - Engaged in sourcing, farming, packaging, marketing, and distribution of avocados, mangoes, and blueberries, Mission Produce has optimized per-unit margins through effective integration of sales and sourcing operations [19][20] - The Zacks Consensus Estimate for Mission Produce's fiscal 2025 earnings has increased by 19% in the past 30 days, although sales and earnings are expected to decline by 6.6% and 32.4% respectively from the previous year [21] Corteva - Corteva is positioned for above-market growth through its innovative product pipeline and strong market demand for naturally derived products [22] - The Zacks Consensus Estimate for Corteva's 2025 earnings suggests growth of 1.7% and 15.2% respectively from the year-ago period [23] Dole - Dole is expected to benefit from improved logistical efficiencies and a healthier supply-demand balance, which has led to better pricing conditions in Europe [24] - The Zacks Consensus Estimate for Dole's 2025 earnings suggests a growth of 4.7% from the previous year [25] Adecoagro - Adecoagro operates in farming, dairy, sugar, ethanol, and energy production, benefiting from high asset flexibility in a volatile market [26] - The Zacks Consensus Estimate for Adecoagro's 2025 earnings suggests declines of 3.2% and 41.1% respectively from the previous year [27] Industry Challenges - The industry faces challenges such as fluctuating commodity prices, rising input costs, trade uncertainties, and increasing operational expenses, which impact productivity and profitability [3][11] - Companies are managing higher selling, general and administrative expenses due to performance-related compensation and technology investments [12] Market Performance - The Zacks Agriculture – Operations industry has underperformed the broader Zacks Consumer Staples sector and the S&P 500, with a collective decline of 12.2% over the past year [16] - The industry is currently trading at a forward P/E ratio of 13.34X, compared to the S&P 500's 20.05X and the sector's 17.18X [17]

Core Viewpoint - Mission Produce, Inc. (AVO) is experiencing significant stock weakness due to market concerns over potential supply-chain disruptions in Mexico and high valuation multiples compared to industry peers [1][4][3]. Valuation Concerns - AVO's forward 12-month price-to-earnings (P/E) ratio is 24.04X, which is substantially higher than the Zacks Agriculture - Operations industry average of 12.62X, indicating that the stock may be overvalued [1][3]. - The price-to-sales ratio of AVO is 0.61X, above the industry's 0.43X, contributing to investor unease regarding its value proposition [2]. Stock Performance - Year-to-date, AVO's shares have declined by 32%, underperforming the broader Agricultural - Operations industry's decline of 11.6% and the Consumer Staples sector's fall of 0.4% [4]. - AVO's stock performance is notably weaker than competitors like Archer Daniels Midland Company (ADM) and Corteva Inc. (CTVA), which have seen declines of 17.3% and 2.5%, respectively [7]. Supply Chain and Market Dynamics - Concerns over volume projections and potential sourcing constraints, particularly from Mexico, are weighing on AVO's stock performance [13]. - AVO anticipates increased volumes from California and Peru to counterbalance the expected decline in Mexican supply, although this transition may present logistical challenges [14]. Growth Potential - Despite current challenges, AVO is well-positioned for long-term growth due to its robust global sourcing network and operational model [18]. - The company's first-quarter fiscal 2025 results showed a 25% year-over-year sales increase, indicating healthy consumer demand and effective pricing strategies [22]. Strategic Initiatives - AVO is expanding its sourcing footprint through increased harvesting in California and Peru, which aims to bolster supply stability amid anticipated constraints in Mexico [23]. - The company is also investing in Latin America, particularly in Guatemalan operations, to enhance its ability to manage regional volatility [23]. Analyst Sentiment - The Zacks Consensus Estimate for AVO's fiscal 2025 and 2026 EPS has increased by 19% and 9.3%, respectively, in the past 30 days, reflecting positive sentiment among analysts [26]. Investment Opportunity - Despite the elevated valuation and recent stock performance concerns, AVO's competitive advantages and market position present a compelling opportunity for long-term investors [28][29].

Core Viewpoint - Mission Produce Inc. (AVO) has experienced a significant decline in stock price, dropping as much as 20.5% due to market concerns over potential supply-chain disruptions in Mexico and ongoing tariff uncertainties [1][2][9] Group 1: Financial Performance - AVO's stock is currently priced at $9.82, reflecting a 2.9% premium to its 52-week low of $9.54, and a 35.6% discount from its 52-week high of $15.25 [6] - The Zacks Consensus Estimate for AVO's fiscal 2025 and 2026 EPS has increased by 19% and 9.3%, respectively, indicating positive sentiment among analysts [14] - For fiscal 2025, the consensus estimates imply year-over-year declines of 6.6% in sales and 32.4% in EPS, with further decreases projected for fiscal 2026 [15] Group 2: Market Dynamics - Concerns over volume projections and potential sourcing challenges have negatively impacted AVO's stock performance, particularly due to a projected decline in avocado volumes from Mexico [9][10] - The company anticipates increased avocado volumes from California and Peru to offset the decline from Mexico, although this transition may lead to supply inconsistencies [10] - In the Peruvian blueberry segment, a 35-40% increase in total harvest volume is expected, but pricing pressures have resulted in a 33% year-over-year decline in average per-unit selling prices [11][12] Group 3: Competitive Positioning - AVO's strengths lie in its robust global sourcing network and operational efficiency, which enable it to meet customer demand while optimizing margins [18][19] - The company's ongoing investments in Latin America, including Guatemalan operations, enhance its long-term competitive positioning against regional supply constraints [20] - Consumer trends favor long-term growth for avocados, driven by rising global demand due to health benefits and popularity in emerging markets [21][22] Group 4: Valuation and Investment Outlook - AVO is currently trading at a forward 12-month P/E multiple of 24.07X, which is above the industry average of 14.11X and the S&P 500's average of 21.18X, indicating high investor expectations for future performance [23] - Despite recent stock performance concerns, AVO's competitive edge and rising avocado prices suggest potential for long-term returns, making it an attractive entry point for investors [25][26]

Core Viewpoint - Mission Produce, Inc. (AVO) has experienced a significant downtrend with a 20.8% decline in stock price over the past four weeks, but it is now in oversold territory, suggesting a potential turnaround due to improved earnings expectations from analysts [1]. Group 1: Technical Indicators - The Relative Strength Index (RSI) for AVO is currently at 28.52, indicating that the stock is oversold and may soon experience a price reversal [5]. - RSI is a momentum oscillator that helps identify whether a stock is overbought or oversold, with readings below 30 typically signaling an oversold condition [2][3]. Group 2: Fundamental Indicators - There has been a strong consensus among sell-side analysts to raise earnings estimates for AVO, resulting in a 23.5% increase in the consensus EPS estimate over the last 30 days [6]. - AVO holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, indicating a favorable outlook for a potential price rebound [7].

Financial Data and Key Metrics Changes - The company achieved record first quarter revenue of $334.2 million, a 29% increase compared to the same period last year [7][20] - Gross profit increased by $2.8 million to $31.5 million, although gross profit margin decreased by 170 basis points to 9.4% of revenue [20][21] - Adjusted net income for the quarter was $7.1 million or $0.10 per diluted share, compared to $6.7 million or $0.09 per diluted share last year [21] Business Line Data and Key Metrics Changes - The Marketing & Distribution segment net sales increased 32% to $295.8 million, driven by avocado pricing and volume dynamics [23] - The Blueberry segment saw a 12% increase in revenue to $36.4 million, with a 70% increase in blueberry volumes sold, partially offset by a 33% decrease in average per unit selling prices [25] - The International Farming segment's sales increased 59% to $9.2 million, with adjusted EBITDA improving to $1.8 million from negative $0.5 million year-over-year [24][25] Market Data and Key Metrics Changes - The company experienced industry supply challenges in Mexico, impacting avocado supply and necessitating increased procurement through co-packers and spot market purchases [8][11] - The company anticipates that industry volumes in the fiscal 2025 second quarter will be consistent with the prior year, with pricing expected to be higher by approximately 5% year-over-year [32] Company Strategy and Development Direction - The company is strategically diversifying its sourcing footprint to include key growing geographies such as Peru, Colombia, and Guatemala to ensure reliable year-round supply [13][14] - The company is expanding its Blueberry and Mango segments, investing in premium varietals and enhancing customer relationships to drive growth [10][11] - The company aims to enhance operational efficiency through the optimization of its distribution footprint and the closure of Canadian facilities [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the dynamic operating environment and highlighted the resiliency of consumer demand for avocados despite inflation [7][8] - The company remains optimistic about long-term growth opportunities in Blueberries and is well-positioned to capitalize on shifting consumer preferences towards healthy snacking options [9][10] - Management acknowledged uncertainty surrounding tariff negotiations but emphasized the value of their global strategy to mitigate potential impacts [17] Other Important Information - Cash and cash equivalents were $40.1 million as of January 31, 2025, with cash used in operating activities amounting to $1.2 million for the first quarter [27][28] - Capital expenditures for the quarter were $14.8 million, attributed to avocado and blueberry farming-related investments [30] Q&A Session Summary Question: Can you elaborate on sourcing from co-packers in the current quarter? - Management indicated that sourcing from co-packers was higher than typical due to a slight decrease in the overall crop in Mexico, but they expect to secure more direct inventory soon [36][38][41] Question: What is the visibility on unwinding working capital build in the second quarter? - Management noted that working capital strains are normal in the first half of the fiscal year and typically unwind in the second half, with expectations for improvement as they transition to harvesting their own fruit [44][46][48] Question: Have you observed any changes in supplier behavior due to tariff discussions? - Management reported that there was more movement and conversation among suppliers leading up to the March announcement, but overall supply remained consistent and they were able to meet customer requirements [51][53]