Cal-Maine Foods Stock Cracks After Egg Producer Reports Q3 Results, Inks Deal To Acquire Echo Lake Foods

Cal-Maine Foods Inc CALM shares are trading lower in Tuesday’s after-hours session after the company reported third-quarter financial results and announced plans to acquire Echo Lake Foods.

Q3 Earnings: Cal-Maine reported fiscal third-quarter revenue of $1.42 billion, missing analyst estimates of $1.43 billion, according to Benzinga Pro. The egg producer reported third-quarter earnings of $10.38 per share, beating analyst estimates of $7.93 per share.

Cal-Maine reported a 14% year-over-year increase in the average number of layer hens during the quarter. The company also reported a 33% increase in breeder flocks and a 24% increase in total chicks hatched during the quarter.

Cal-Maine’s board approved a $500 million share repurchase program during the third quarter and declared a cash dividend of approximately $3.46 per share.

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“Dynamic market conditions and HPAI-related supply shortages persisted this quarter. However, the entire Cal-Maine Foods team did an outstanding job in maximizing production through a period of high demand, while operating safely and maintaining diligence on biosecurity measures,” said Sherman Miller, president and CEO of Cal-Maine Foods.

“We were fortunate to have the ability to utilize our existing operational scale and to benefit from recent acquisitions, which helped increase our production capacity in this challenging supply environment.”

In addition to earnings, Cal-Maine announced that it signed a definitive agreement to acquire Echo Lake Foods for approximately $258 million. Echo Lake Foods produces ready-to-eat egg products and breakfast foods.

The transaction has been approved by both companies’ boards and is expected to close by the end of fiscal 2025.

CALM Price Action: Cal-Maine shares were down 4.57% after-hours, trading at $86.20 at the time of publication Tuesday, according to Benzinga Pro.

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Photo: Courtesy of Cal-Maine Foods.