As the Q2 earnings season wraps, let’s dig into this quarter’s best and worst performers in the perishable food industry, including Pilgrim's Pride (NASDAQ: PPC) and its peers.
The perishable food industry is diverse, encompassing large-scale producers and distributors to specialty and artisanal brands. These companies sell produce, dairy products, meats, and baked goods and have become integral to serving modern American consumers who prioritize freshness, quality, and nutritional value. Investing in perishable food stocks presents both opportunities and challenges. While the perishable nature of products can introduce risks related to supply chain management and shelf life, it also creates a constant demand driven by the necessity for fresh food. Companies that can efficiently manage inventory, distribution, and quality control are well-positioned to thrive in this competitive market. Navigating the perishable food industry requires adherence to strict food safety standards, regulations, and labeling requirements.
The 11 perishable food stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 3.7% while next quarter’s revenue guidance was 2.7% above.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 5.8% since the latest earnings results.
Pilgrim's Pride (NASDAQ: PPC)
Offering everything from pre-marinated to frozen chicken, Pilgrim’s Pride (NASDAQ: PPC) produces, processes, and distributes chicken products to retailers and food service customers.
Pilgrim's Pride reported revenues of $4.76 billion, up 4.3% year on year. This print exceeded analysts’ expectations by 2.9%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ EBITDA and gross margin estimates.
“During the quarter, our portfolio captured market upsides from attractive market fundamentals,” said Fabio Sandri, Pilgrim’s President and CEO.
Unsurprisingly, the stock is down 13.4% since reporting and currently trades at $41.31.
Is now the time to buy Pilgrim's Pride? Access our full analysis of the earnings results here, it’s free.
Best Q2: Mission Produce (NASDAQ: AVO)
Founded in 1983 in California, Mission Produce (NASDAQ: AVO) grows, packages, and distributes avocados.
Mission Produce reported revenues of $357.7 million, up 10.4% year on year, outperforming analysts’ expectations by 11.7%. The business had an incredible quarter with a beat of analysts’ EPS and gross margin estimates.
Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 1.5% since reporting. It currently trades at $12.68.
Is now the time to buy Mission Produce? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Beyond Meat (NASDAQ: BYND)
A pioneer at the forefront of the plant-based protein revolution, Beyond Meat (NASDAQ: BYND) is a food company specializing in alternatives to traditional meat products.
Beyond Meat reported revenues of $74.96 million, down 19.6% year on year, falling short of analysts’ expectations by 8.6%. It was a softer quarter as it posted a significant miss of analysts’ EBITDA and gross margin estimates.
Beyond Meat delivered the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is flat since the results and currently trades at $2.91.
Read our full analysis of Beyond Meat’s results here.
Tyson Foods (NYSE: TSN)
Started as a simple trucking business, Tyson Foods (NYSE: TSN) is one of the world’s largest producers of chicken, beef, and pork.
Tyson Foods reported revenues of $13.88 billion, up 3.6% year on year. This number surpassed analysts’ expectations by 2.9%. Overall, it was a strong quarter as it also recorded a solid beat of analysts’ EBITDA and EPS estimates.
The stock is up 4% since reporting and currently trades at $54.64.
Read our full, actionable report on Tyson Foods here, it’s free.
Fresh Del Monte Produce (NYSE: FDP)
Translating to "of the mountain" in Spanish, Fresh Del Monte (NYSE: FDP) is a leader in providing high-quality, sustainably grown fresh fruits and vegetables.
Fresh Del Monte Produce reported revenues of $1.18 billion, up 3.8% year on year. This result beat analysts’ expectations by 2.2%. It was an exceptional quarter as it also logged an impressive beat of analysts’ EBITDA and EPS estimates.
The stock is down 3.5% since reporting and currently trades at $34.81.
Read our full, actionable report on Fresh Del Monte Produce here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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