Why Mission Produce Stock Is Rocketing Higher Today
Mission's results weren't incredible, but they were good enough to clear the low bar set by analysts.
Why Mission Produce Stock Is Rocketing Higher Today
Overview
Shares of the leading vertically integrated avocado-selling behemoth Mission Produce (NASDAQ: AVO) soared 11% higher as of 11 a.m. ET on Tuesday after the company reported solid, but mixed, second-quarter earnings. After the stock dipped to $15 in April this year, then to $10 before today's spike, the market's reaction may be more relief than any outrageously good Q2 numbers.
Sales declined 24% in Q1 (but beat analysts' expectations) as avocado prices fell 36% while volume jumped 15% in a normalizing avocado pricing environment. Despite the sales decline, Mission's adjusted EBITDA rose 5% as its margins remained resilient and rose slightly. However, the figure that stole the show was management's guidance to generate $86 million in adjusted EBITDA at the midpoint in the second half of the year. For a company with an enterprise value of just $1 billion, this is pretty attractive guidance and shows that Mission isn't outrageously priced for its potential.
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Originally published at www.fool.com.
