Calavo Growers (CVGW – Research Report), the Consumer Defensive sector company, was revisited by a Wall Street analyst today. Analyst Ben Klieve from Lake Street remains neutral on the stock and has a $40.00 price target.
Ben Klieve has given his Buy rating due to a combination of factors pertaining to Calavo Growers’ operational and financial developments. Despite the company’s Q4’23 results falling short of initial estimates, there was noticeable improvement in fresh and prepared avocado margins, which is seen as a sustainable trend and central to Calavo’s value. Klieve also underscores the anticipated positive impact from the potential divestiture of Calavo’s Renaissance Food Group (RFG) segment, which is expected to streamline operations and contribute positively to earnings.
While acknowledging the current uncertainties stemming from the Foreign Corrupt Practices Act (FCPA) compliance issues, Klieve believes that these do not detract from the company’s core value drivers. He projects that if the FCPA issues are not significantly detrimental, and with the expected improvement in avocado margins and successful divestiture of RFG, there exists a substantial upside to the company’s earnings power. As a result, despite lowering the price target from $45 to $40, Klieve maintains a bullish stance on the stock, postulating that the culmination of these factors could lead to considerable value growth for Calavo Growers.
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Calavo Growers (CVGW) Company Description:
Calavo Growers, Inc. engages in marketing and distribution of avocados, prepared avocados, and other perishable foods. It operates through the following segments: Fresh Products, Calavo Foods, and Renaissance Food Group. The Fresh Products segment grades, sizes, packs, cools, and ripens avocados for delivery to the customers. The Calavo Foods segment procures and processes avocados into wide variety of guacamole products; and distributes the processed products to the customers. The Renaissance Food Group segment produces, markets, and distributes nationally a portfolio of healthy fresh packaged food products for consumers via the retail channel. Calavo Growers was founded in 1924 and is headquartered in Santa Paula, CA.
Read More on CVGW:
- Calavo Growers, Inc. Announces Fourth Quarter and Fiscal 2023 Financial Results
- Calavo Growers explores sale of Fresh Cut Business to F&S Fresh Foods
- Calavo Growers Delays Release of its Fourth Quarter and Fiscal Year 2023 Financial Results
- Calavo Growers Evaluating Potential Sale of Its Fresh Cut Business (formerly “RFG”); Declares Quarterly Dividend
- CVGW Earnings this Week: How Will it Perform?
