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BB&T Capital Markets Upgrades Cal-Maine Foods to ‘Hold’

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Cal-Maine Foods’ price movement

Cal-Maine Foods (CALM) has a market cap of $2.1 billion. It rose by 2.7% to close at $41.19 per share on June 16, 2016. The stock’s weekly, monthly, and YTD (year-to-date) price movements were -4.2%, -12.2%, and -8.9%, respectively, on the same day. CALM is trading 6.3% below its 20-day moving average, 14.1% below its 50-day moving average, and 18.2% below its 200-day moving average.

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Related ETFs and peers

The Vanguard Small-Cap ETF (VB) invests 0.04% of its holdings in Cal-Maine Foods. The ETF tracks the CRSP US Small Cap Index. The market cap–weighted index includes the bottom 2%–15% of the investable universe. VB has risen 3.7% YTD as of June 16.

The Vanguard Consumer Staples ETF (VDC) invests 0.17% of its holdings in Cal-Maine Foods. The ETF tracks a market cap–weighted index of stocks in the consumer staples sector of the US market.

The market caps of Cal-Maine Foods’ competitors are as follows:

  • Pilgrim’s Pride (PPC): $6.4 billion
  • Industrias Bachoco S.A.B. de C.V. ADR (IBA): $2.5 billion

Cal-Maine Foods’ rating

BB&T Capital Markets has upgraded Cal-Maine Foods’ rating to “hold” from “underweight.”

Cal-Maine Foods’ performance in fiscal 3Q16

Cal-Maine Foods (CALM) reported fiscal 3Q16 net sales of $449.8 million, a rise of 2.8% compared to net sales of $437.6 million in fiscal 3Q15. A dozen eggs sold fell by 1.9%, and a dozen eggs produced rose by 4.8% in fiscal 3Q16 compared to fiscal 3Q15.

In fiscal 3Q16, Cal-Maine Foods’ net income and EPS (earnings per share) rose to $64.2 million and $1.33, respectively, compared to $50.9 million and $1.05, respectively, in fiscal 3Q15.

In fiscal 3Q16, CALM’s cash and cash equivalents and inventories rose by 49.7% and 5.4%, respectively, compared to fiscal 4Q15. Its current ratio rose to 5.1x from 3.9x, and its debt-to-equity ratio fell to 0.23x from 0.32x in fiscal 4Q15.

In the next part of this series, we’ll look at Nu Skin Enterprises.

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