Back to top

Image: Bigstock

CalMaine (CALM) Closes Tyson's Processing Plant Acquisition

Read MoreHide Full Article

CalMaine Foods, Inc. (CALM - Free Report) announced the completion of the previously announced acquisition of Tyson Foods, Inc. (TSN - Free Report) . It acquired a broiler processing plant, hatchery and feed mill in Dexter, MO. This move is in sync with CALM's growth strategy, which includes select acquisitions, along with organic growth initiatives.

CalMaine Foods intends to repurpose the assets for the production of eggs and egg products. Initially, the egg producer will transform the broiler processing plant into an egg grading facility. The company sees potential growth with egg product processing capabilities, such as hard-cooked eggs.

Cal-Maine Foods anticipates entering arrangements with some of Tyson's former contract farmers to convert their operations to support CALM's egg production operations.

This deal will help CalMaine Foods expand its geographic footprint in Missouri and surrounding markets, and enhance its ability to serve customers. The company plans to make further investments in the facilities and the community in order to create job opportunities.

As CALM expands its market reach, it stays committed to the effective and long-term management of existing and acquired operations, as well as addressing the demands of its customers.

The company reported earnings per share of 35 cents in second-quarter fiscal 2024. The bottom line marked a roughly 91% slump from the prior-year quarter.

Sales plunged 34.7% year over year to $523.2 million in the second quarter of fiscal 2024. The company reported exceptionally strong second-quarter fiscal 2023 sales of $802 million. The downside was driven by the substantial drop in the net average selling price of conventional eggs.

However, sales volumes improved 1.4% year over year to 288.2 million total dozens sold in the second-quarter fiscal 2024.

Price Performance

CALM shares have gained 15.3% in the past year compared with the industry’s 4.8% growth.

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

Zacks Rank & Stocks to Consider

CalMaine currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the basic materials space are Ecolab Inc. (ECL - Free Report) and Hawkins, Inc. (HWKN - Free Report) . ECL sports a Zacks Rank #1 (Strong Buy) at present and HWKN has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Ecolab’s 2024 earnings is pegged at $6.39 per share, indicating an increase of 22.7% from the prior year’s reported number. It has an average trailing four-quarter earnings surprise of 1.7%. ECL shares have gained 41.8% in a year.

The Zacks Consensus Estimate for Hawkins’ fiscal 2024 earnings is pegged at $3.61 per share, indicating a year-over-year rise of 26.2%. The Zacks Consensus Estimate for HWKN’s current-year earnings has been revised 4.3% north in the past 60 days. It has an average trailing four-quarter earnings surprise of 30.6%. The company’s shares have rallied 70% in the past year.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Ecolab Inc. (ECL) - free report >>

Tyson Foods, Inc. (TSN) - free report >>

Cal-Maine Foods, Inc. (CALM) - free report >>

Hawkins, Inc. (HWKN) - free report >>

Published in