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Village Farms Streamlines Operations: What Investors Should Watch

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Key Takeaways

  • Village Farms streamlined operations in Q3, simplifying assets, capacity and costs.
  • Village Farms converted Delta 2 from tomatoes to cannabis, lifting space to 2.2M sq ft.
  • Village Farms held SG&A at $15.6M, ended with $82.6M cash and repaid $3M in U.S. debt.

Village Farms International (VFF - Free Report) highlighted continued operational streamlining during the third quarter of 2025, with actions focused on simplifying the business and improving efficiency across its footprint. These actions were reflected in how the company managed assets, production capacity and costs during the quarter.

One key development came from the produce segment. During the quarter, results included output from the Delta 1 greenhouse and part of Delta 2. After quarter-end, the Delta 2 tomato crop was removed to allow the facility to be converted to cannabis production. Once this conversion is complete, the total operational cannabis space in Delta will reach 2.2 million square feet, reflecting Village Farms’ focus on utilizing existing assets more efficiently.

Cost control remained a key focus during the quarter. Selling, general and administrative expenses totaled $15.6 million, rising slightly from last year but remaining controlled relative to revenue growth. The company continued to prioritize efficiency and process improvements rather than increasing spending across the board.

The benefits of these actions were also visible on the balance sheet. Cash and cash equivalents stood at $82.6 million at quarter-end, along with $5 million in restricted cash. In August, Village Farms used operating cash flow to repay $3 million of U.S. term debt related to its produce privatization transaction, helping further simplify its capital structure.

Overall, Village Farms’ operational streamlining emphasizes converting existing assets, maintaining cost discipline and taking a measured approach to capital use. How consistently these efforts support efficiency across the business will be an important point for investors to track.

What the Latest Metrics Say About Village Farms

Village Farms, which competes with The Scotts Miracle-Gro Company (SMG - Free Report) and Mission Produce, Inc. (AVO - Free Report) , has seen its shares soar 381.9% in the past year, outperforming the industry’s decline of 10.6%, the Zacks Consumer Staples sector’s growth of 4.3% as well as the S&P 500’s 17.6% appreciation. Meanwhile, shares of Scotts Miracle-Gro have lost 11.4%, while Mission Produce has risen 11.7% in the aforementioned period.

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From a valuation standpoint, Village Farms’ forward 12-month price-to-sales ratio stands at 1.55, lower than the industry’s 2.24. VFF carries a Value Score of C. Village Farms is trading at a premium to Scotts Miracle-Gro (with a forward 12-month P/S ratio of 1.06) as well as Mission Produce (0.76). 

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Image Source: Zacks Investment Research

The Zacks Consensus Estimate for Village Farms’ current and next financial-year bottom line implies year-over-year growth of 165.6% and 14.3%, respectively.

Village Farms 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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The Scotts Miracle-Gro Company (SMG) - free report >>

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