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Mission Produce (AVO)
NASDAQ:AVO
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Mission Produce (AVO) AI Stock Analysis

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AVO

Mission Produce

(NASDAQ:AVO)

Rating:69Neutral
Price Target:
$13.00
▲(2.77% Upside)
Mission Produce's overall stock score is bolstered by strong technical indicators and positive earnings call sentiment, indicating potential growth opportunities and strategic market expansions. Financial performance shows a positive trajectory but highlights areas for improvement, especially in cash flow management. The valuation suggests a premium pricing, which may limit attractiveness if growth expectations are not met.
Positive Factors
Earnings Resilience
Mission continues to be well-positioned to prove that its FY24 success was reflective of its durable earnings power.
Revenue Performance
Q1’25 posted a solid 15% revenue beat on continued elevated avocado pricing.
Supply Chain Strength
Mission's global supply chain and owned production in Peru make it uniquely well-positioned to navigate this era.
Negative Factors
Cost Pressures
Margin improvement was limited given a difficult YoY comp and higher than average use of co-packers for supply.
Margin Improvement Challenges
Earnings delivered a more modest beat given subdued margin improvement via increased use of co-packers for sourcing amid high demand and uneven supply.

Mission Produce (AVO) vs. SPDR S&P 500 ETF (SPY)

Mission Produce Business Overview & Revenue Model

Company DescriptionMission Produce, Inc. (AVO) is a global leader in the avocado industry, specializing in the sourcing, production, distribution, and marketing of fresh avocados. Founded in 1983 and headquartered in Oxnard, California, Mission Produce operates across various sectors including farming, packing, and logistics to deliver high-quality avocados to retail, wholesale, and foodservice customers worldwide. The company is recognized for its vertically integrated supply chain, which ensures year-round availability and a consistent supply of avocados to its diverse customer base.
How the Company Makes MoneyMission Produce generates revenue primarily through the sale of fresh avocados. The company's vertically integrated business model allows it to control the entire supply chain, from farming and harvesting to packing and distribution. This integration helps optimize costs and ensure quality, enhancing profitability. Key revenue streams include direct sales to retail chains, wholesalers, and foodservice providers. Additionally, Mission Produce benefits from strategic partnerships with growers and distributors, enhancing its market reach and supply capabilities. The company's global operations and focus on efficiency and innovation in agriculture and logistics further contribute to its financial performance.

Mission Produce Earnings Call Summary

Earnings Call Date:Jun 05, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Sep 08, 2025
Earnings Call Sentiment Positive
The earnings call presented a largely positive outlook with record revenues, strong performance in international markets, and significant growth in the mango and blueberry segments, despite facing some challenges such as increased SG&A expenses and lower gross profit margins due to avocado supply issues.
Q2-2025 Updates
Positive Updates
Record Second Quarter Revenue
Mission Produce delivered a record second quarter revenue of $380.3 million, marking a 28% increase compared to the prior year period.
Strong Avocado Pricing
Per unit avocado selling prices increased by 26%, driven by strong consumer demand.
International Expansion Success
The forward distribution center in the UK delivered strong results with expanded customer penetration, leading to increased facility utilization.
Mango Business Growth
Achieved record mango volumes and significant market share gains, positioning Mission Produce as a leading U.S. distributor.
Improved International Farming Segment
International Farming segment turned a period of seasonal headwind into a positive contributor, with significant EBITDA improvement.
Blueberry Segment Expansion
Blueberry segment sales increased 57%, supported by higher production volumes and increased acreage.
Peruvian Avocado Production Recovery
Expected 50% increase in Peruvian avocado production, recovering from last year's weather-related decrease.
Share Repurchase Program
Executed $5.2 million of share repurchases in Q2, with $14 million remaining on board authorization.
Negative Updates
Lower Gross Profit Margin
Gross profit decreased to $28.4 million compared to $31 million in the prior year, primarily due to lower avocado per unit margins.
Increased SG&A Expenses
SG&A expenses rose by 15%, or $2.8 million, mainly due to higher employee-related and professional fees.
Avocado Supply Challenges
Challenges in obtaining necessary Mexican fruit supply early in the quarter affected margins.
Impact of Tariffs
Incurred $1.1 million in tariffs on USMCA compliant goods imported from Mexico during a brief period.
Flat EBITDA in Blueberry Segment
Despite higher sales, the Blueberry segment's EBITDA remained flat due to lower per unit gross margins.
Company Guidance
During the Mission Produce fiscal second quarter 2025 conference call, the company reported record revenue of $380.3 million, marking a 28% increase from the prior year. Adjusted EBITDA was strong, though slightly down from last year at $19.1 million, compared to $20.2 million. The marketing and distribution segment saw a 26% increase in net sales to $362.5 million, while the International Farming segment's net sales rose significantly by $6.7 million to $8.1 million, showing a notable EBITDA improvement. Additionally, the Blueberry segment experienced a 57% increase in net sales to $15.7 million, driven by higher production volumes. The company also executed $5.2 million in share repurchases, reflecting confidence in its valuation. Looking forward, Mission Produce expects a strong Peruvian avocado harvest, with an anticipated production increase of 50% this season. The company's diversification strategy and continued focus on global market expansion position it well for future growth.

Mission Produce Financial Statement Overview

Summary
Mission Produce demonstrates a positive financial trajectory with notable improvements in revenue growth and profitability. The balance sheet reflects a healthy leverage position, though there is room to optimize asset utilization further. Cash flow management presents opportunities for improvement, particularly in free cash flow generation, which is critical for sustaining long-term growth and investment. Overall, the company is on a solid path with strategic areas identified for enhancement.
Income Statement
70
Positive
Mission Produce shows a healthy TTM revenue growth of 12.8%, driven by strategic improvements over the past year. Gross Profit Margin is stable at approximately 11% TTM, reflecting efficient cost management, though slightly below industry leaders. Net Profit Margin has improved significantly from previous losses, now at 2.6% TTM, indicating a positive turnaround. EBIT and EBITDA margins are 4.4% and 7.3% respectively, showing moderate operational efficiency improvements.
Balance Sheet
65
Positive
The company's Debt-to-Equity ratio is 0.45, demonstrating a balanced leverage position with manageable debt levels. Return on Equity (ROE) improved to 6.6% TTM, signaling better profitability from equity investments. However, the Equity Ratio stands at 54.6%, suggesting a strong equity base but with room for better asset utilization.
Cash Flow
60
Neutral
Free Cash Flow shows a significant decline of -59.1% TTM, highlighting potential challenges in cash generation. Operating Cash Flow to Net Income Ratio is robust at 1.84, indicating strong cash conversion from net income. Yet, the Free Cash Flow to Net Income Ratio of 0.68 suggests potential reinvestment needs or capital allocation inefficiencies.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue1.23B953.90M1.05B891.70M862.30M
Gross Profit152.50M83.30M89.80M124.50M124.60M
EBITDA110.70M43.50M4.40M94.40M86.50M
Net Income36.70M-2.80M-34.90M44.90M28.80M
Balance Sheet
Total Assets971.50M914.80M879.50M873.50M777.30M
Cash, Cash Equivalents and Short-Term Investments58.00M42.90M52.80M84.50M124.00M
Total Debt217.30M252.70M214.10M213.30M178.60M
Total Liabilities394.40M386.50M356.60M339.30M303.80M
Stockholders Equity547.30M503.60M502.10M534.20M473.50M
Cash Flow
Free Cash Flow61.20M-20.60M-26.00M-26.40M11.60M
Operating Cash Flow93.40M29.20M35.20M47.00M78.90M
Investing Cash Flow-33.50M-54.10M-51.40M-70.30M-67.70M
Financing Cash Flow-43.80M14.30M-21.80M-11.50M50.10M

Mission Produce Technical Analysis

Technical Analysis Sentiment
Positive
Last Price12.65
Price Trends
50DMA
12.25
Positive
100DMA
11.46
Positive
200DMA
11.84
Positive
Market Momentum
MACD
0.12
Positive
RSI
57.94
Neutral
STOCH
42.93
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AVO, the sentiment is Positive. The current price of 12.65 is above the 20-day moving average (MA) of 12.46, above the 50-day MA of 12.25, and above the 200-day MA of 11.84, indicating a bullish trend. The MACD of 0.12 indicates Positive momentum. The RSI at 57.94 is Neutral, neither overbought nor oversold. The STOCH value of 42.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AVO.

Mission Produce Risk Analysis

Mission Produce disclosed 42 risk factors in its most recent earnings report. Mission Produce reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Mission Produce Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
70
Outperform
$1.39B17.256.03%1.90%-6.66%-21.70%
69
Neutral
$879.90M24.166.89%29.50%108.33%
66
Neutral
$1.69B-4.11%6.62%53.12%
63
Neutral
$20.42B14.38-2.77%3.17%2.07%-6.17%
58
Neutral
$906.72M2,245.98-2.08%3.26%1.54%-134.75%
57
Neutral
$190.34M-18.35%4.88%-1359.01%
55
Neutral
$485.17M47.556.90%2.93%-14.58%
* Consumer Defensive Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
AVO
Mission Produce
12.65
1.93
18.00%
CVGW
Calavo Growers
27.28
4.97
22.28%
SPTN
SpartanNash Co
26.81
5.69
26.94%
ANDE
The Andersons
40.83
-9.21
-18.41%
UNFI
United Natural Foods
27.92
12.79
84.53%
HFFG
HF Foods Group
3.39
-0.16
-4.51%

Mission Produce Corporate Events

Stock BuybackBusiness Operations and StrategyFinancial Disclosures
Mission Produce Reports Q2 Revenue Growth Despite Challenges
Neutral
Jun 5, 2025

On June 5, 2025, Mission Produce announced its fiscal second quarter financial results, reporting a 28% increase in total revenue to $380.3 million, primarily driven by the Marketing & Distribution segment. Despite achieving record revenue, the company experienced a decrease in net income to $3.1 million, attributed to challenges in obtaining Mexican avocado supply and increased costs, including tariffs and facility closures. The company executed $5.2 million in share repurchases, reflecting confidence in its financial performance and operational execution. Mission Produce’s mango business gained significant market share, and its operations in the UK showed progress, enhancing its global market position.

The most recent analyst rating on (AVO) stock is a Buy with a $16.00 price target. To see the full list of analyst forecasts on Mission Produce stock, see the AVO Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jun 27, 2025