Key Takeaways
- Cal-Maine Foods shares gained Wednesday, a day after the company reported better-than-expected results on higher egg prices and holiday season demand.
- The biggest U.S. egg producer also benefited from the acquisition of the production assets of ISE America.
- Cal-Maine said egg prices have continued to rise as recent outbreaks of Bird Flu in the U.S. limited supply.
Cal-Maine Foods (CALM) shares gained Wednesday, a day after the biggest U.S. egg producer beat profit and sales estimates on higher prices, holiday season demand, and an acquisition.
The company reported fiscal second-quarter earnings of $4.47 per share, with revenue up 82.5% year-over-year to $954.7 million, both well above forecasts.
The gains came as the average price of a dozen eggs soared 58.4% to $2.74, and the number of dozen eggs sold climbed 14.5% to 329,844.
CEO Sherman Miller said demand for eggs was “robust,” resulting in “a significant increase in dozens sold for the quarter, which included the seasonal boost leading up to the Thanksgiving holiday and sales from our latest acquisition completed in June.” That’s when Cal-Maine closed on its deal to obtain the production assets of ISE America.
Miller also pointed to the impact of Bird Flu outbreaks in the U.S., noting egg prices “have continued to rise this fiscal year as supply levels of shell eggs have been restricted due to recent outbreaks of highly pathogenic avian influenza (‘HPAI’).”
Shares of Cal-Maine Foods were up over 2% in intraday trading Wednesday and have nearly doubled in value over the past year.
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