For Immediate Release
Chicago, IL – June 30, 2017 –Zacks Equity Research Calavo Growers, Inc. (NASDAQ: CVGW – Free Report ) as the Bull of the Day, Andersons, Inc. (NASDAQ: ANDE – Free Report ) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on AptarGroup, Inc. (NYSE: ATR – Free Report ), UFP Technologies, Inc. (NASDAQ: UFPT – Free Report ) and Mobile Mini, Inc. (NASDAQ: MINI – Free Report ).
Here is a synopsis of all five stocks:
Calavo Growers, Inc. (NASDAQ:CVGW – Free Report ) is cashing in on record avocado and fresh food demand. This Zacks Rank #1 (Strong Buy) just reported a record second quarter across all of its segments.
Calavo Growers is a Santa Paula, California avocado and fresh produce grower of a variety of products including tomatoes and tropical produce. Its food business makes and manufactures guacamole, guacamole hummus and salsa under the Calavo brand name.
Its Renaissance Food Group also makes lifestyle products through fast-growing brands such as Garden Highway and Chef Essentials.
A Big Beat in the Fiscal Second Quarter of 2017
On June 6, Calavo reported its fiscal second quarter results and easily beat the Zacks Consensus Estimate by 15%. The company earned $0.74 versus the Zacks Consensus of $0.64.
It was a record second quarter with virtually all key metrics reaching new all-time, single-period highs.
Revenue rose 23% to $270.2 million while gross margin jumped 35% to a record $36.3 million, or 13.4% of total revenue. That was up from 12.2% of total revenue in the year ago quarter.
Each of its segments saw double digit growth.
In the Fresh segment, which includes avocados, revenue jumped due to focus and execution of the Calavo team combined with record consumer demand which is exceeding available industry supply.
The avocado crop, industry-wide, has been smaller this year than last year. Calavo, for instance, packed just 4.8 million total units in the quarter compared to 6.4 million total units in the year ago quarter due to the smaller avocado crop.
But that supply-demand imbalance has also meant higher avocado prices which is why revenue remained so robust.
In the Renaissance Food Group segment, revenue rose by 24% due to the addition of new retail customers, added divisions of existing customers, penetration into newer geographic markets and the broadening of product capabilities.
It continues to expand its plants and add capacity which impacted gross margin in this segment in the quarter.
The Future's Bright
Avocado toast has been all the rage for the past year and while this food item gets mocked, it represents the growing demand for avocado in a host of foods and settings.
Avocado isn't just limited to guacamole in the local Mexican restaurant anymore.
Globally, more consumers are eating avocado than ever before which is also putting pressure on prices.
Calavo re-affirmed its full year outlook, stating that it was on track to achieve double-digit growth in revenue and gross margin dollars. It still expects to post record earnings per share for the fiscal year.
The analysts are bullish too. One estimate has been raised for the full fiscal year in the last week which has pushed the Zacks Consensus Estimate up to $2.53 from $2.46. That is earnings growth of 16%. Calavo made just $2.18 last year.
Fiscal 2018 is also looking good with another 15.4% earnings growth.
Shares Leap to 3-Year High
The shares have been on quite a tear with all the good news this year.
They ran up to 3-year highs before giving back a little bit of the recent gains.
They're not cheap. Calavo trades with a forward P/E of 27 but you're buying the growth, not the value.
As an added bonus, Calavo does reward shareholders with a dividend. It's currently yielding 1.3%.
For investors looking for a way to play the hot avocado and fresh food trend, Calavo should be on your short list.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this out performance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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The Andersons, Inc. (NASDAQ:ANDE – Free Report ) is struggling to find the right mix in the agribusiness sector. This Zacks Rank #5 (Strong Sell) has closed its retail stores as part of its turnaround strategy.
The Andersons was founded in 1947 by Harold Anderson in Maumee, Ohio with a single grain elevator. It has grown into an agribusiness company with numerous business segments across North America, including in grain, ethanol, plant nutrient and rail.
End of an Era as Andersons General Stores Close
On June 3, The Andersons closed its 4 remaining Andersons General Stores, which were located in Columbus and Toledo, Ohio.
It was a bittersweet moment for many in Ohio as the first store opened in 1952 and employed 1050, although 75% of those were part-time workers.
The retail stores were a legacy of the original founder but the stores could not compete with Home Depot (NYSE:HD), Lowe's, Tractor Supply and others in the same space as retail became more competitive.
The retail segment had lost $20 million over the past 8 years. It never recovered from the Great Recession as it hadn't made annual profit since 2008.
But this means it can focus on areas it does well, including its grain and rails businesses.
Met the Estimate in the First Quarter
On May 3, The Andersons reported first quarter results and met the Zacks Consensus Estimate of $0.07.
Three of its 4 business segments saw better year-over-year results.
In addition to getting rid of its retail operations, it sold some underperforming Nutrient Group assets in Florida in the quarter.
In good news, it acquired a small specialty grain handling and milling business that will boost its food ingredient capabilities.
The Plant Nutrient and Rail segments had weak quarters but it looks like market conditions might be bottoming.
In nutrients, low prices due to oversupply are expected to persist but should start to improve in 2018. Demand remains strong.
In the rails, North American rail traffic improved year-over-year but volumes remained historically low. However, the company believes that the rails are in the later stages of a cyclical market downturn.
Estimates Cut
The analysts are still pessimistic on the changes being made, at least for 2017.
The 2017 Zacks Consensus Estimate fell to $1.75 from $2.22 just 90 days ago. However, 2018 looks a little better with the consensus at $2.35.
Shares Fall From 1-Year Highs
Shares of The Andersons have fallen since the company announced in early January 2017 that it was closing its retail operations.
However, they're still not that cheap. It trades with a forward P/E of 19.7.
Shareholders do get a dividend, currently yielding 1.9% for their patience.
If you're looking for an agribusiness company with a better Rank, you might want to consider Syngenta. It's a Zacks Rank #1 (Strong Buy).
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this out performance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
Additional Content
3 Packaging Stocks That are Must-Adds to Your Portfolio
Packaging demand has remained remarkably consistent in the past decade resulting in the industry outperforming the S&P 500. Customer convenience remains the top priority for the companies in the global packaging market and consequently they remain constantly focused on bringing in new packaging designs or redesigning existing packaging as per customer preferences.
The packaging companies are focused on expanding geographic reach and realigning product offerings to reduce operational costs. They are targeting on high growth segments to strengthen financial position in the market. At present, the market is witnessing intense restructuring and consolidation because of the overcapacity. The preference for value-added services and customized packaging solutions to provide convenience, safety, durability as well as freshness protection will continue to boost the industry.
The Zacks categorized Containers and Glass industry has outperformed the S&P 500 over the past one year. The industry has clocked a gain of 22.7%, ahead of the S&P 500’s increase of 19.7%. It consists of the Containers –Paper and Packaging sub industry and the Containers- Metal /Glass subindustry that gained a respective 23.3% and 22.2% over the same time frame.
The Containers and Glass industry along with its sub industries falls under the industrial products sector (one of the 16 broad Zacks sectors) that put up a 28.5% growth in earnings in first-quarter 2017 and an 11.7% growth in earnings is projected in second-quarter 2017. The Industrial Products sector is one of the three sectors projected to log a double-digit growth in the second quarter. (Read more: Q2 Earnings Season Preview )
It would be a prudent move to zero in on some stocks in the packaging space right now that exhibit all signs of healthy prospects. We have, thus, highlighted a few stocks that are good buys right now, backed by a strong Zacks Rank and upward estimate revisions.
AptarGroup, Inc. (NYSE:ATR – Free Report ) provides a range of packaging, dispensing, and sealing solutions, primarily for the beauty, personal care, home care, prescription drug, consumer health care, injectable, and food and beverage markets.
The stock carries a Zacks Rank #2 (Buy) and has a long-term expected earnings growth rate of 9.33%. The company has delivered positive earnings surprises in the last four quarters, with an average beat of 1.78%. The estimates for the company for fiscal 2017 and fiscal 2018 have moved north 5% and 5%, respectively in the last 60 days, reflecting the positive outlook of analysts. The projected growth rate for earnings in fiscal 2017 is 10.04% and for fiscal 2018 at 8.42%.
UFP Technologies, Inc. (NASDAQ:UFPT – Free Report ) designs and converts foams, plastics, composites, and natural fiber materials and provides solutions to medical, automotive, consumer, electronics, industrial, aerospace, and defense markets in the U.S. It carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here .
UFP Technologies has a positive average earnings surprise of 7.91% in the last four quarters. The estimate for fiscal 2017 climbed 19% to $1.39 in the past 60 days. The Zacks Consensus Estimate for fiscal 2018 has also moved north 2% to $1.75. The projected growth rate for fiscal 2017 is 26.36% and for fiscal 2018 at 25.90%.
Mobile Mini, Inc. (NASDAQ:MINI – Free Report ), a provider of portable storage and specialty containment solutions, also sports a Zacks Rank #2. The Zacks estimate for earnings for fiscal 2017 has moved up 1% to $1.26 in the past 60 days. The Zacks Consensus Estimate for fiscal 2018 has also moved north 1% to $1.44
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation. See Them Free>>
About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
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Calavo Growers, Inc. (CVGW): Free Stock Analysis Report
The Andersons, Inc. (ANDE): Free Stock Analysis Report
AptarGroup, Inc. (ATR): Free Stock Analysis Report
UFP Technologies, Inc. (UFPT): Free Stock Analysis Report
Mobile Mini, Inc. (MINI): Free Stock Analysis Report
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