Why Mission Produce Stock Is Rocketing Higher Today
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.
Image source: Getty Images.
Source Fool.com
