Cal-Maine Foods expands with North Carolina feed mill acquisition

RIDGELAND, Miss. - Cal-Maine Foods , Inc. (NASDAQ: NASDAQ:CALM), the nation’s largest producer of fresh shell eggs and a company currently valued at $5.2 billion, has expanded its operations with the acquisition of assets from Deal-Rite Feeds, Inc., including two feed mills and other related assets in North Carolina. The transaction, which was completed today, was funded entirely with cash on hand, showcasing the company’s strong balance sheet with more cash than debt.

The acquired assets consist of two feed mills located in Statesville and Union Grove, storage facilities, grain inventory, a fleet of vehicles, equipment, and the retail feed sales business. This strategic acquisition is aimed at supporting Cal-Maine Foods’ shell egg production facilities in North Carolina by reducing feed costs and improving supply chain efficiency.

Sherman Miller, president and CEO of Cal-Maine Foods, stated that the addition of these feed mill operations will allow the company to formulate, produce, and deliver feed at a lower cost due to shorter travel distances to the farms. He emphasized the importance of feed quality and composition in maintaining hen health and the nutritional value of shell eggs. Miller also expressed the company’s commitment to efficiency and sustainability in egg production and indicated they will continue to seek opportunities to support growth.

Cal-Maine Foods is primarily engaged in the grading, packaging, marketing, and distribution of a variety of fresh shell eggs, including cage-free and organic options. The company’s operations span across the majority of the United States. According to InvestingPro, the company maintains excellent financial health with a current ratio of 5.46 and is currently trading at an attractive P/E ratio of 8.34. InvestingPro analysis suggests the stock may be undervalued based on its Fair Value calculation.

The press release also included forward-looking statements regarding the company’s intentions and expectations for the future, which involve risks and uncertainties. These statements are not guaranteed and are subject to factors that could cause actual results to differ materially from those projected. However, InvestingPro data shows promising indicators with revenue growth forecast of 45% for FY2025. Subscribers can access 12 additional ProTips and comprehensive financial metrics to better evaluate the company’s prospects.

This expansion by Cal-Maine Foods is based on a press release statement and represents the company’s ongoing efforts to enhance its production capabilities and cost management in the competitive shell egg market.

In other recent news, Cal-Maine Foods displayed a strong performance in its second quarter earnings for fiscal year 2025, surpassing both Stephens’ and the consensus estimates. The company reported an adjusted earnings per share (EPS) of $4.48 and an adjusted EBITDA of $325.4 million, exceeding the predicted $4.25 EPS and $282.4 million EBITDA by Stephens, and $4.05 EPS and $303.7 million EBITDA by consensus. Cal-Maine Foods also recorded robust sales, with a 14.5% increase year-over-year, selling 329.8 million dozen eggs at an average price of $2.74 per dozen, up from $1.73 in the previous year’s quarter.

These recent developments were driven by a strong supply and demand balance, heightened seasonal egg demand, and higher market prices. Despite supply restrictions due to the Highly Pathogenic Avian Influenza (HPAI), Cal-Maine leveraged its scale and recent acquisitions to meet customer needs. In light of these factors, Stephens decided to maintain its Equal Weight (Volatility) rating but increased the price target to $97 from the previous $88.

Additionally, Cal-Maine plans to invest approximately $60 million in new capital projects to expand cage-free egg production capacity, expected to add capacity for about 1.1 million cage-free layer hens by late summer 2025. Lastly, the company declared a quarterly dividend of $1.49 per share. These recent developments highlight Cal-Maine Foods’ strong financial health and potential for continued growth.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.