Earnings PotentialIf Calavo can maintain 10%+ gross margins in fresh avocados, return the Prepared segment to growth with 20%+ gross margins, and operate a lean operating expense model, an earnings step change can take place.
Market PricingThe outlook appears positive as pricing for larger retail-destined fruit has continued to rise, while Mexican producers have oversupplied smaller fruits.
Stock PerformanceCalavo is a show-me stock entering FY25, and if it executes throughout this year, alpha will follow from depressed levels.