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Mission Produce Jumps 15% in a Month: Buy the Momentum or Stay Back?
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Key Takeaways
Mission Produce shares jumped 14.8% in a month, outpacing key indexes and sector benchmarks.
AVO posted record Q2 revenue growth of 28%, driven by strong pricing and strategic execution.
Strategic moves in mango, U.K. markets and capital allocation position AVO for long-term growth.
Mission Produce Inc. (AVO - Free Report) shares have witnessed strong momentum in the past month, rising as much as 14.8%. The company’s stock performance was primarily bolstered by solid second-quarter fiscal 2025 results, wherein strategic execution and favorable industry dynamics outweighed certain margin pressures. The company’s second-quarter fiscal 2025 results reflected strong year-over-year top-line growth, wherein the figure also surpassed the Zacks Consensus Estimate.
Looking ahead, the company remains optimistic about Peruvian supply, growth in value-added fruit segments and strategic capital allocation, which support investors’ bullish stance on AVO's stock trajectory for 2025.
The company’s sharp rise has led it to outperform the Zacks Agriculture – Operations industry and the S&P 500 index’s increases of 5.2% and 2.7%, respectively, in the past month. Additionally, the AVO stock has surpassed the Consumer Staples sector’s decline of 1.2% in the same period.
AVO’s performance is also notably weaker than that of its close competitors, Archer Daniels Midland Company (ADM - Free Report) , Corteva Inc. (CTVA - Free Report) and Calavo Growers (CVGW - Free Report) , which posted growth of 7.5%, 4% and 0.4%, respectively, in the past month.
Mission Produce’s 1-Month Price Performance
Image Source: Zacks Investment Research
Currently at $12.02, the AVO stock trades 26% above its 52-week low of $9.54. The Mission Produce stock’s price also stands 21% below its 52-week high of $15.25, reflecting upside potential.
The stock trades above its 50-day and 200-day simple moving averages (SMA), indicating a bullish sentiment. SMA is an essential tool in technical analysis that helps investors evaluate price trends by smoothing out short-term fluctuations. This approach provides a clearer perspective on a stock's long-term direction.
Mission Produce’s recent quarterly performance, which showcased record revenue growth, promising operational resilience and strong volume projections, has bolstered the stock’s performance. AVO reported year-over-year revenue growth of 28%, the highest ever for a fiscal second quarter, driven primarily by higher average avocado selling prices (up 26%). Despite flat volume, elevated prices reflected robust consumer demand amid constrained supply in Mexico, highlighting the brand’s pricing power and category resilience. Although adjusted EPS declined 14.3% year over year, it outpaced the Zacks Consensus Estimate, reflecting sound underlying performance.
Operationally, Mission Produce's vertically integrated model continues to pay off. The International Farming segment recorded a sharp turnaround, with revenues skyrocketing 479% and adjusted EBITDA improving to $1.5 million, thanks to better mango yields and higher blueberry service volumes. The company also repurchased $5.2 million of its shares, highlighting management's confidence in AVO’s long-term valuation. While the gross margin dipped to 7.5%, this was due to short-term supply constraints and is expected to normalize as Peruvian volumes ramp up.
For third-quarter fiscal 2025, Mission Produce expects avocado industry volumes to rise 10-15%, driven by a robust Peruvian harvest. AVO’s production is expected to reach 100-110 million pounds, more than double last year’s weather-affected output. Although pricing is likely to soften by 10-15%, higher volume should support overall revenue growth.
Management’s strategic push into the mango and the U.K. markets, alongside disciplined capital spending and continued cash generation in the second half, provides a positive long-term outlook. Backed by steady fundamentals and global diversification, AVO appears well-positioned to deliver shareholder value through 2025 and beyond.
Mission Produce’s Estimate Revision Trend
The Zacks Consensus Estimate for AVO’s fiscal 2025 EPS moved up 18% in the last 30 days, indicating positive sentiment among analysts for the company's earnings. Following a favorable outlook for forward industry trends, analysts seem confident about Mission Produce’s prospects.
For fiscal 2025, the Zacks Consensus Estimate for AVO’s sales implies year-over-year growth of 8.1%, while the estimate for EPS indicates a 20.3% fall. The consensus mark for fiscal 2026 sales and earnings suggests year-over-year declines of 8% and 20.3%, respectively. (See the Zacks Earnings Calendar to stay ahead of market-making news.)
Image Source: Zacks Investment Research
Is AVO’s Premium Valuation Justified?
Mission Produce is currently trading at a forward 12-month P/E multiple of 27.84X, exceeding the industry average of 16.45X and the S&P 500’s average of 22.13X.
At 27.84X P/E, Mission Produce trades at a significant premium to its industry peers. The company’s peers, such as Archer Daniels, Corteva and Calavo Growers, are delivering growth and trade at more reasonable multiples. Archer Daniels, Corteva and Calavo Growers have forward 12-month P/E ratios of 12.08X, 22.81X and 13.08X — all significantly lower than that of AVO.
Although the current valuation may seem expensive, it suggests that investors have high expectations for AVO's future performance and growth potential. The company’s capability to execute its strategy and capitalize on a favorable pricing environment is essential for ensuring profitability and consistent performance in its Marketing and Distribution segment. While success in these areas can strengthen its market leadership, its failure can pose serious challenges for AVO.
Image Source: Zacks Investment Research
Is Mission Produce a Promising Bet Now?
AVO’s recent stock performance, coupled with upward estimate revisions for fiscal 2025, reflects growing investor confidence and a promising trajectory. Mission Produce benefits from a competitive edge through its vertically integrated operations and global sourcing network, enabling it to navigate supply disruptions while meeting customer demand. Its strong market position, supported by rising avocado prices and effective execution across business segments, continues to drive operational resilience and top-line momentum.
For investors, Mission Produce presents a compelling opportunity to tap into the growing global demand for fresh produce with a company that is focused on long-term efficiency and strategic expansion. Despite its premium valuation and recent stock momentum, the company’s solid fundamentals and visibility into the future make AVO an appealing stock for investors seeking exposure to a category-leading agribusiness. The company currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Mission Produce Jumps 15% in a Month: Buy the Momentum or Stay Back?
Key Takeaways
Mission Produce Inc. (AVO - Free Report) shares have witnessed strong momentum in the past month, rising as much as 14.8%. The company’s stock performance was primarily bolstered by solid second-quarter fiscal 2025 results, wherein strategic execution and favorable industry dynamics outweighed certain margin pressures. The company’s second-quarter fiscal 2025 results reflected strong year-over-year top-line growth, wherein the figure also surpassed the Zacks Consensus Estimate.
Looking ahead, the company remains optimistic about Peruvian supply, growth in value-added fruit segments and strategic capital allocation, which support investors’ bullish stance on AVO's stock trajectory for 2025.
The company’s sharp rise has led it to outperform the Zacks Agriculture – Operations industry and the S&P 500 index’s increases of 5.2% and 2.7%, respectively, in the past month. Additionally, the AVO stock has surpassed the Consumer Staples sector’s decline of 1.2% in the same period.
AVO’s performance is also notably weaker than that of its close competitors, Archer Daniels Midland Company (ADM - Free Report) , Corteva Inc. (CTVA - Free Report) and Calavo Growers (CVGW - Free Report) , which posted growth of 7.5%, 4% and 0.4%, respectively, in the past month.
Mission Produce’s 1-Month Price Performance
Image Source: Zacks Investment Research
Currently at $12.02, the AVO stock trades 26% above its 52-week low of $9.54. The Mission Produce stock’s price also stands 21% below its 52-week high of $15.25, reflecting upside potential.
The stock trades above its 50-day and 200-day simple moving averages (SMA), indicating a bullish sentiment. SMA is an essential tool in technical analysis that helps investors evaluate price trends by smoothing out short-term fluctuations. This approach provides a clearer perspective on a stock's long-term direction.
AVO Stock Trades Above 50 & 200-Day Moving Averages
Image Source: Zacks Investment Research
What’s Fueling AVO’s Momentum?
Mission Produce’s recent quarterly performance, which showcased record revenue growth, promising operational resilience and strong volume projections, has bolstered the stock’s performance. AVO reported year-over-year revenue growth of 28%, the highest ever for a fiscal second quarter, driven primarily by higher average avocado selling prices (up 26%). Despite flat volume, elevated prices reflected robust consumer demand amid constrained supply in Mexico, highlighting the brand’s pricing power and category resilience. Although adjusted EPS declined 14.3% year over year, it outpaced the Zacks Consensus Estimate, reflecting sound underlying performance.
Operationally, Mission Produce's vertically integrated model continues to pay off. The International Farming segment recorded a sharp turnaround, with revenues skyrocketing 479% and adjusted EBITDA improving to $1.5 million, thanks to better mango yields and higher blueberry service volumes. The company also repurchased $5.2 million of its shares, highlighting management's confidence in AVO’s long-term valuation. While the gross margin dipped to 7.5%, this was due to short-term supply constraints and is expected to normalize as Peruvian volumes ramp up.
For third-quarter fiscal 2025, Mission Produce expects avocado industry volumes to rise 10-15%, driven by a robust Peruvian harvest. AVO’s production is expected to reach 100-110 million pounds, more than double last year’s weather-affected output. Although pricing is likely to soften by 10-15%, higher volume should support overall revenue growth.
Management’s strategic push into the mango and the U.K. markets, alongside disciplined capital spending and continued cash generation in the second half, provides a positive long-term outlook. Backed by steady fundamentals and global diversification, AVO appears well-positioned to deliver shareholder value through 2025 and beyond.
Mission Produce’s Estimate Revision Trend
The Zacks Consensus Estimate for AVO’s fiscal 2025 EPS moved up 18% in the last 30 days, indicating positive sentiment among analysts for the company's earnings. Following a favorable outlook for forward industry trends, analysts seem confident about Mission Produce’s prospects.
For fiscal 2025, the Zacks Consensus Estimate for AVO’s sales implies year-over-year growth of 8.1%, while the estimate for EPS indicates a 20.3% fall. The consensus mark for fiscal 2026 sales and earnings suggests year-over-year declines of 8% and 20.3%, respectively. (See the Zacks Earnings Calendar to stay ahead of market-making news.)
Image Source: Zacks Investment Research
Is AVO’s Premium Valuation Justified?
Mission Produce is currently trading at a forward 12-month P/E multiple of 27.84X, exceeding the industry average of 16.45X and the S&P 500’s average of 22.13X.
At 27.84X P/E, Mission Produce trades at a significant premium to its industry peers. The company’s peers, such as Archer Daniels, Corteva and Calavo Growers, are delivering growth and trade at more reasonable multiples. Archer Daniels, Corteva and Calavo Growers have forward 12-month P/E ratios of 12.08X, 22.81X and 13.08X — all significantly lower than that of AVO.
Although the current valuation may seem expensive, it suggests that investors have high expectations for AVO's future performance and growth potential. The company’s capability to execute its strategy and capitalize on a favorable pricing environment is essential for ensuring profitability and consistent performance in its Marketing and Distribution segment. While success in these areas can strengthen its market leadership, its failure can pose serious challenges for AVO.
Image Source: Zacks Investment Research
Is Mission Produce a Promising Bet Now?
AVO’s recent stock performance, coupled with upward estimate revisions for fiscal 2025, reflects growing investor confidence and a promising trajectory. Mission Produce benefits from a competitive edge through its vertically integrated operations and global sourcing network, enabling it to navigate supply disruptions while meeting customer demand. Its strong market position, supported by rising avocado prices and effective execution across business segments, continues to drive operational resilience and top-line momentum.
For investors, Mission Produce presents a compelling opportunity to tap into the growing global demand for fresh produce with a company that is focused on long-term efficiency and strategic expansion. Despite its premium valuation and recent stock momentum, the company’s solid fundamentals and visibility into the future make AVO an appealing stock for investors seeking exposure to a category-leading agribusiness. The company currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.