Core Viewpoint - Cal-Maine Foods (CALM) is showing potential for investment due to its recent technical breakout and positive earnings revisions [1][2][3] Technical Analysis - CALM has recently broken above the 50-day moving average, indicating a short-term bullish trend [1] - The stock has increased by 17.1% over the past four weeks, suggesting upward momentum [2] Earnings Estimates - There has been one upward revision in earnings estimates for the current fiscal year, with no downward revisions, indicating positive sentiment [3] - The consensus earnings estimate has also increased, further supporting the bullish outlook for CALM [3] Investment Rating - CALM is currently rated as a Zacks Rank 1 (Strong Buy), suggesting strong potential for continued price appreciation [2]

Group 1 - Cal-Maine Foods (CALM) has surpassed resistance at the 20-day moving average, indicating a potential short-term bullish trend [1][4] - The stock has moved 7.1% higher over the last four weeks, suggesting a possible upcoming rally [4] - CALM is currently rated as a Zacks Rank 1 (Strong Buy), supported by positive earnings estimate revisions [4][5] Group 2 - The 20-day simple moving average is a popular trading tool that helps smooth out short-term price trends and signals trend reversals [2] - A stock price above the 20-day moving average indicates a positive trend, while a price below suggests a downward trend [2]

Core Insights - Cal-Maine Foods, the largest egg producer in the U.S., reported earnings below expectations while announcing an acquisition of Echo Lake Foods, a breakfast food manufacturer [1][2][3] - The company's fiscal third quarter earnings were $10.38 per share, significantly up from $3 per share a year ago but below the anticipated $10.90 per share [2] - Quarterly sales reached $1.42 billion, a 102% increase year-over-year, yet fell short of expectations by $10 million [3] Financial Performance - The company experienced a volatile trading day, with shares initially falling 8%, then rising as much as 6%, and closing up about 3% [1] - Over the past year, Cal-Maine shares have increased by 48%, although they are down 20% from their peak [4] - The company offers a 4.6% dividend yield and has announced a $500 million share repurchase agreement, making it an attractive option for investors seeking growth and income [5] Acquisition Details - Cal-Maine announced plans to acquire Echo Lake Foods for $258 million, which generated sales of $240 million in 2024 [3] - CEO Sherman Miller highlighted the company's ability to maximize production during high demand while maintaining biosecurity measures [3]

Core Viewpoint Cal-Maine Foods, Inc. (CALM) has reported significant financial improvements in the third quarter of fiscal 2025, driven by high demand and elevated egg prices, despite challenges posed by avian influenza outbreaks affecting supply. Financial Performance - Earnings per share (EPS) reached $10.38, a substantial increase from $3.00 in the same quarter last year [1] - Total sales surged to $1.42 billion, reflecting a 102% year-over-year increase due to higher net average selling prices and increased volumes sold [3] - Gross profit was approximately $716 million, marking a 228% increase from the previous year, with a gross margin of 50.5%, up from 31.1% [7] Pricing and Sales Volume - The net average selling price per dozen eggs was $4.06, an 80.7% increase year-over-year, with conventional eggs seeing a 121.5% rise to $4.766 per dozen [4] - Cal-Maine sold a record 331.4 million dozen shell eggs, a 10% increase from the previous year, with conventional egg sales up 11% and specialty egg sales up 9% [5] Cost and Margin Analysis - Farm production costs per dozen decreased by 5.7% year-over-year, while feed costs per dozen fell by 9.6% [6] - Operating profit was reported at $636 million, compared to $163 million in the prior year, with an operating margin of 44.8% [8] Cash Position and Shareholder Returns - The company ended the quarter with cash and cash equivalents of $1.24 billion, up from $812 million at the end of fiscal 2024 [9] - A $500 million share repurchase program was approved, and a cash dividend of $3.46 per share was declared [9][10] Industry Challenges - Ongoing outbreaks of highly pathogenic avian influenza (HPAI) have led to significant depopulation of commercial laying hens, impacting overall supply [12] - The USDA reported the table-egg layer flock at approximately 285 million as of March 1, 2025, the lowest level since September 2015 [12] Growth Initiatives - Cal-Maine is investing $60 million in capital projects to expand cage-free capacity, including the addition of new layer houses [14] - The company is acquiring Echo Lake Foods for $258 million, which is expected to enhance its presence in the value-added food segment [16][17] Stock Performance - Cal-Maine shares have increased by 44.7% over the past year, contrasting with a 19.8% decline in the industry [18]

Group 1 - U.S. stock futures are lower, with Dow futures dropping over 600 points [1] - Kura Sushi USA Inc reported a quarterly loss of 14 cents per share, missing the analyst consensus estimate of a loss of 13 cents per share [1] - Kura Sushi's quarterly sales were $64.89 million, slightly below the analyst consensus estimate of $64.91 million [1] Group 2 - Kura Sushi projects FY25 total sales between $275 million and $279 million, compared to market estimates of $280.741 million [2] - Kura Sushi shares fell 3.3% to $40.10 in pre-market trading [2] Group 3 - Enhabit Inc shares dipped 35.5% to $5.00 in pre-market trading [3] - CCC Intelligent Solutions Holdings Inc shares fell 34.8% to $5.40 in pre-market trading [3] - Smith Douglas Homes Corp declined 32.5% to $12.00 in pre-market trading after a 10% drop on Tuesday [3] - Donegal Group Inc declined 27.3% to $13.10 in pre-market trading [3] - Ambac Financial Group Inc fell 24.1% to $5.00 in pre-market trading [3] - Ramaco Resources Inc shares dipped 22.6% to $5.00 in pre-market trading [3] - LXP Industrial Trust fell 17.7% to $5.94 in pre-market trading [3] - Repay Holdings Corp declined 15% to $4.23 in pre-market trading [3] - Neuropace Inc declined 11.7% to $9.80 in pre-market trading after a previous 10% fall [3] - Inventrust Properties Corp fell 9.9% to $23.41 in pre-market trading [3] - Kinetik Holdings Inc fell 7.2% to $39.00 in pre-market trading [3] - Cal-Maine Foods Inc fell 4% to $86.78 in pre-market trading after reporting worse-than-expected third-quarter revenue results [3]

Core Viewpoint - Cal-Maine Foods, the largest US egg producer, is under investigation by the Justice Department for potential antitrust violations related to egg price increases, leading to a decline in its stock price by over 4% in after-hours trading [1]. Company Performance - Cal-Maine reported nearly doubled sales of $1.42 billion in its fiscal third quarter ending March 1, primarily driven by higher egg prices, which averaged $4.06 per dozen, up from $2.25 per dozen a year ago [4][7]. - The company sold a record 331.4 million dozen eggs in the third quarter, marking a 10% increase from the same period last year [6]. - Despite the significant increase in sales, Cal-Maine's revenue fell short of Wall Street's forecast of $1.43 billion [4]. Financial Metrics - The net income for Cal-Maine in the third quarter more than tripled to $508.5 million compared to the same period last year, translating to a profit of $10.38 per share, which was below analysts' expectations of $10.72 per share [7]. Industry Context - Egg prices have reached record highs, with one dozen Grade A eggs averaging $5.90 in February, a 10.4% increase from the previous year, surpassing January's record of $4.95 [3]. - The surge in egg prices is largely attributed to a bird flu epidemic that has resulted in the culling of over 166 million birds, primarily egg-laying chickens [3][5].

Core Viewpoint - Cal-Maine Foods is under investigation by the Justice Department regarding potential antitrust violations related to egg pricing, which has been a significant factor in U.S. inflation concerns [1][2]. Financial Performance - Cal-Maine reported a nearly doubled net sales of $1.42 billion for the fiscal quarter ending March 1, although this figure fell slightly short of Wall Street expectations [1][2]. - The company experienced a 145% increase in conventional egg sales compared to the same period last year, driven by a 121% surge in prices for conventional eggs, contributing to a $557.4 million increase in net sales [2]. Sales and Pricing Trends - In the last quarter, Cal-Maine sold 331.4 million dozen eggs, marking a 10% year-over-year increase [3]. - Egg prices peaked in February, with wholesale large white eggs reaching over $8 per dozen, before declining to $3.27 per dozen by mid-March [3][7]. Market Context - The surge in egg prices and subsequent shortages have been largely attributed to a bird flu outbreak that has led to the depopulation of 30.3 million birds this year [7]. - Grocery chains, including Walmart and Trader Joe's, have implemented nationwide limits on egg purchases due to the strained supply chain [7]. Stock Performance - Following the announcement of the investigation, Cal-Maine's shares fell 4% in after-hours trading, closing down 3.3% at $90.33, resulting in a 12.2% decline since the beginning of the year [5]. Investigation Details - The Justice Department's investigation aims to determine if there has been any anticompetitive conduct among egg producers [1][6]. - Cal-Maine has stated it is cooperating with the investigation but cannot predict its duration or potential financial impact [2].

Production and Market Position - Cal-Maine Foods has a total flock of approximately 48.9 million layers and 12.3 million pullets and breeders, making it the largest producer and distributor of fresh shell eggs in the U.S.[94] - In fiscal 2025, the average number of layer hens increased by 14%, and total chicks hatched rose by 24% compared to the prior-year quarter[103]. - Cage-free egg revenue represented approximately 19.2% of total shell egg revenue for the third quarter of fiscal year 2025[105]. - The company has engaged in proactive measures to mitigate the tight egg supply situation, including increasing breeder flocks by 33%[103]. - Ten states have passed legislation mandating cage-free requirements for egg production, affecting approximately 27% of the U.S. population[104]. Financial Performance - In Q3 fiscal 2025, the company recorded a gross profit of $716.1 million, up from $218.6 million in Q3 fiscal 2024, driven by a significant increase in net average selling prices of shell eggs and total dozens sold[111]. - The net average selling price per dozen for Q3 fiscal 2025 was $4.060, compared to $2.247 in the prior-year period, reflecting a 80.5% increase[112]. - Total net sales for Q3 fiscal 2025 reached $1.4 billion, a 101.6% increase from $703.1 million in Q3 fiscal 2024[118]. - Shell egg sales accounted for 94.9% of total net sales in Q3 fiscal 2025, with conventional egg sales increasing by $602.8 million, or 145.7%, compared to Q3 fiscal 2024[119][123]. - For the thirty-nine weeks ended March 1, 2025, total net sales were $3.2 billion, compared to $1.7 billion for the same period in fiscal 2024, marking an 87.4% increase[120]. - Gross profit for the thirty-nine weeks ended March 1, 2025, was $1.3 billion, compared to $355.1 million for the same period in 2024, reflecting higher net average selling prices[130]. Cost and Expenses - The company’s farm production costs per dozen produced decreased by 5.7%, or $0.06, compared to the prior year, primarily due to lower feed costs[114]. - Egg purchases and other costs of sales increased by $163.8 million quarter-over-quarter, primarily due to higher shell egg prices and increased volumes purchased[114]. - Total cost of sales for the thirteen weeks ended March 1, 2025, was $701.6 million, a 44.8% increase compared to $484.5 million for the same period in 2024[126]. - Selling, general, and administrative expenses totaled $79.97 million for the thirteen weeks ended March 1, 2025, a 21.1% increase from $66.02 million for the same period in 2024[132]. - Processing, packaging, and warehouse costs increased by 17.6% in the third quarter of fiscal 2025 compared to the same period in fiscal 2024, due to a 13.5% increase in the volume of processed dozens[129]. Income and Taxation - Operating income for the third quarter of fiscal 2025 was $635.7 million, compared to $162.8 million for the same period in fiscal 2024[142]. - Income tax expense for the third quarter of fiscal 2025 was $154.9 million, with an effective tax rate of 23.4%[146]. - For the thirty-nine weeks ended March 1, 2025, pre-tax income was $1.1 billion, a significant increase from $208.0 million for the same period in fiscal 2024[147]. - Net income attributable to Cal-Maine Foods, Inc. for the thirty-nine weeks ended March 1, 2025, was $877.6 million, or $17.99 per basic share, compared to $164.6 million, or $3.38 per basic share, for the same period in fiscal 2024[151]. - The effective tax rate for the thirty-nine weeks ended March 1, 2025, was 23.8%, compared to 21.5% for the same period in fiscal 2024[150]. Cash Flow and Capital Management - Cash flows from operating activities for the thirty-nine weeks ended March 1, 2025, provided $811.7 million, up from $237.6 million in the comparable period of fiscal 2024[153]. - Working capital increased to $1.5 billion at March 1, 2025, compared to $1.0 billion at June 1, 2024, while the current ratio decreased to 3.9 from 5.5[152]. - The company paid dividends of $160.8 million for the thirty-nine weeks ended March 1, 2025, compared to $43.0 million in the same prior-year period[155]. - A new $500 million share repurchase program was approved on February 25, 2025, allowing the company to repurchase shares at management's discretion[157]. - The company anticipates that its current cash balances and projected cash flows will be sufficient to fund capital expenditure needs for at least the next 12 months[163]. Strategic Investments and Acquisitions - The company completed a strategic investment with Crepini LLC, capitalizing the new venture with approximately $6.75 million for a 51% interest[108]. - The acquisition of ISE America, Inc. included assets with a capacity of approximately 4.7 million laying hens, enhancing market reach in the Northeast and Mid-Atlantic states[107]. - The company acquired the assets of Fassio Egg Farms, Inc. in Q2 fiscal 2024, enhancing its market presence in Utah and the western U.S. for cage-free eggs[110]. - Cash paid for business acquisitions was $116.2 million in the thirty-nine weeks ended March 1, 2025, primarily related to the ISE acquisition[154]. Future Outlook and Expansion - Ongoing expansion projects are expected to add approximately 1.1 million cage-free layer hens and 250,000 pullets, with a projected investment of $60 million[103]. - The company expects to complete construction projects for cage-free production capacity in calendar 2025, adding approximately 1.1 million cage-free layer hens and 250 thousand pullets[162].

Financial Performance - Quarterly net sales reached $1.4 billion, with net income of $508.5 million, or $10.38 per diluted share, compared to $703.1 million and $146.7 million, respectively, in the same quarter last year[11] - Cal-Maine Foods reported net sales of $1,417,685,000 for the 13 weeks ended March 1, 2025, a significant increase from $703,076,000 in the same period last year, representing a growth of approximately 101%[37] - The gross profit for the same quarter was $716,115,000, compared to $218,572,000 in the prior year, indicating a gross profit margin increase from 31.1% to 50.5%[37] - The net income attributable to Cal-Maine Foods for the 39 weeks ended March 1, 2025, was $877,573,000, a substantial increase from $164,647,000 in the same period last year[37] Production and Sales - The average number of layer hens increased by 14% year-over-year, and the breeder flocks grew by 33% compared to the prior-year quarter[3] - A record 331.4 million dozen shell eggs were sold, representing a 10.2% increase from 300.8 million dozen in the third quarter of fiscal 2024[13] - The net average selling price per dozen eggs was $4.060, up from $2.247 a year ago, reflecting higher market prices due to reduced supply from HPAI[12] - Farm production costs per dozen were 5.7% lower than the prior-year period, primarily due to favorable commodity pricing for key feed ingredients[16] Acquisitions and Investments - The company announced a definitive agreement to acquire Echo Lake Foods for approximately $258 million, expected to close by the end of fiscal 2025[6] - Echo Lake Foods generated annual revenues of approximately $240 million in 2024, with a five-year CAGR of about 10%[6] - The acquisition of Echo Lake Foods is expected to be accretive to Cal-Maine Foods' earnings starting in fiscal 2026, with significant operational synergies anticipated[7] - The company announced a definitive agreement to acquire Echo Lake Foods, aiming to diversify its product mix and reduce financial volatility[29] Shareholder Returns - The company approved a $500 million share repurchase program and declared a cash dividend of approximately $170 million, or $3.46 per share[3] - Cal-Maine Foods has a new share repurchase program authorized for up to $500 million, although no shares were repurchased during the third quarter of 2025[25][24] Financial Position - Cash and short-term investments increased to $1,240,373,000 as of March 1, 2025, up from $812,377,000 on June 1, 2024[39] - The total assets of Cal-Maine Foods reached $3,081,569,000, compared to $2,184,761,000 in the previous year, reflecting a growth of approximately 41%[39] Regulatory and Compliance - The company is cooperating with a civil investigative demand related to an antitrust investigation into nationwide egg price increases[26] - The company expects support from the USDA, which announced up to $1 billion in investments to address issues affecting the domestic egg supply[27] Share Statistics - The weighted average shares outstanding for diluted earnings per share was 48,971,000 for the quarter, slightly up from 48,884,000 in the previous year[37] Biosecurity Measures - The company has invested over $70 million in biosecurity technology and measures since 2015 to combat ongoing HPAI threats[3]

Core Viewpoint - Cal-Maine is the leading U.S. egg producer, benefiting from a vertically integrated approach in a fragmented market, but faces challenges due to the increasing demand for cage-free eggs [1] Company Overview - Cal-Maine operates as the largest egg producer in the United States, utilizing a vertically integrated business model [1] Market Dynamics - The company has capitalized on its position in a fragmented market, which has allowed it to maintain a competitive edge [1] - There is a growing consumer demand for cage-free eggs, which is testing the company's adaptability to changing market preferences [1]