Mission Produce slumps after PT cuts, potential Q1 supply issues

Mission Produce

23/12/2021 19:08

** Avocado seller's shares  AVO.O  down 9.5% at $15.65 - set
for worst day in over three months
    ** AVO posts adj Q4 profit of 24 cents per share, missing 
est of 30 cents earnings per share - Refinitiv data
    ** Says industry expects volumes to be flat to slightly down
in Q1 YoY, primarily due to supply constraints associated with
the Mexican harvest
    ** Shift of sourcing to Mexico is going to drive improvement
in profitability as we move through next several qtrs, but cost
inflation still an issue - Stephens, which cuts PT to $20 from
$25
    ** Q1 supply issues mainly because industry is highly
reliant on the Michoacán region of Mexico this time of year and
region's avocado harvest is weaker than normal and of poorer
quality according to AVO - JP Morgan, which cuts PT to $18 from
$20
    ** 3 of 5 brokerages rate the stock "buy" or higher, 2
"hold"; their median PT is $20
    ** Up to last close, stock up 15% YTD

 (Reporting by Akash Sriram in Bengaluru)
 ((Akash.Sriram@thomsonreuters.com;))