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Can AVO's Supply Chain Integration Drive Stability in Uncertain Times?

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Key Takeaways

  • Mission Produce posted record Q2 revenues of $380.3M, up 28% Y/Y on strong avocado pricing and category gains.
  • Supply chain integration and multi-crop expansion boosted mango share and turned farming profitable.
  • AVO trades at 25.54X forward P/E vs. 15.53X industry average, with EPS set to drop 20.3% in 2025 and 2026.

Mission Produce, Inc.’s (AVO - Free Report) supply chain integration appears to be paying off in today’s volatile environment, with second-quarter fiscal 2025 results highlighting the strength of its global sourcing network and distribution infrastructure. The company reported record second-quarter revenues of $380.3 million, up 28% year over year, supported by strong avocado pricing and expanded category penetration. Management credited its ability to flex between sourcing regions, Mexico, California and Peru, as a key driver of performance, ensuring continuity of supply and quality despite disruptions such as tariffs, weather-related issues and localized shortages.

The integration strategy has also unlocked growth across adjacent categories like mangos and blueberries. Mission Produce has successfully leveraged existing customer relationships, ripening facilities and logistics assets to scale its mango business, reaching close to 10% U.S. market share, while new blueberry acreage is boosting volumes. These moves validate the company’s approach of diversifying crop exposure and optimizing facility utilization year-round, which reduces dependency on any single region or harvest season. This multi-crop, multi-origin strategy helped transform what was once a seasonal headwind in its International Farming segment into a positive EBITDA contributor.

Mission Produce’s ability to manage volatility hinges on balancing capacity, forecasting and customer programs across geographies. The expected 150% rebound in Peruvian avocado production this year underscores how integrated farming and distribution assets provide resilience against shocks like last year’s weather-driven supply shortfall. While tariff uncertainties and margin pressures remain challenges, Mission Produce’s investments in infrastructure, grower partnerships and global diversification are reinforcing its role as a reliable supplier in an unpredictable environment. In short, supply chain integration is proving to be not only a stabilizer but also an accelerator of growth for AVO.

AVO Faces Stiff Competition From CVGW & FDP

Calavo Growers, Inc. (CVGW - Free Report) and Fresh Del Monte Produce Inc. (FDP - Free Report) are two key competitors in the fresh produce industry, each leveraging distinct strategic advantages.

Calavo has long built its reputation on strong supply chain execution, supported by deep partnerships with Mexican growers, advanced packing capabilities and a resilient distribution network. These strengths enable CVGW to reliably deliver high-quality avocados to both retail and foodservice customers, even amid market volatility. However, while this operational excellence has underpinned consistent performance, Calavo’s next stage of growth may require going beyond reliability. Expanding its value-added portfolio, accelerating international penetration and strengthening consumer-facing brand engagement are likely to be critical for sustaining long-term momentum.

Fresh Del Monte operates a fully integrated model that covers farming, packaging, shipping and ripening, providing both global scale and end-to-end control. This structure allows Fresh Del Monte to efficiently source and distribute a broad assortment of fruits, including avocados, across diverse markets worldwide. While its logistics capabilities and cost efficiencies remain clear competitive strengths, future growth will depend on its ability to expand into higher-margin categories, drive innovation across its product portfolio and capitalize on cross-selling opportunities with retail partners.

AVO’s Price Performance, Valuation & Estimates

Shares of Mission Produce have gained 23.6% in the last three months compared with the industry’s growth of 10.6%.

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From a valuation standpoint, AVO trades at a forward price-to-earnings ratio of 25.54X, significantly above the industry’s average of 15.53X.

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The Zacks Consensus Estimate for AVO’s fiscal 2025 and 2026 earnings suggests a year-over-year decline of 20.3% for both years. The estimates for fiscal 2025 and 2026 have been unchanged in the past seven days.

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AVO stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


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