November 14, 2024
Top 10 Stock Calavo Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Calavo – Top 10 Stock in S&P Food & Beverage Index
Calavo is listed as a top 10 stock on November 14, 2024 in the market index S&P US Food & Beverage because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. While the company shows high growth, the stock price is high yet professional investor sentiment is low, which may be due to overly optimistic investor behavior, reflected in a low stock price value. Based on the Obermatt 360° View of 72 (high 72% performer), Obermatt assesses an overall buy recommendation for Calavo on November 14, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Packaged Foods & Meats |
| Index | Sound Pay USA, NASDAQ, S&P US Food & Beverage |
| Size class | Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Calavo Buy
| 360 METRICS | November 14, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 40 |
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| GROWTH | ||||||||
| GROWTH | 70 |
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| SAFETY | ||||||||
| SAFETY | 82 |
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| SENTIMENT | ||||||||
| SENTIMENT | 36 |
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| 360° VIEW | ||||||||
| 360° VIEW | 72 |
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ANALYSIS: With an Obermatt 360° View of 72 (better than 72% compared with alternatives), overall professional sentiment and financial characteristics for the stock Calavo are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Calavo. The consolidated Growth Rank has a good rank of 70, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. This means that growth is higher than for 70% of competitors in the same industry. In addition, the consolidated Safety Rank has a safer rank of 82 which means that the company has a financing structure that is safer than 82% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the consolidated Value Rank has a less desirable rank of 40 which means that the share price of Calavo is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is higher than for 60% of alternative stocks in the same industry. The consolidated Sentiment Rank also has a low rank of 36, which means that professional investors are more pessimistic about the stock than for 64% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 72, Calavo is better positioned than 72% of all alternative stock investment opportunities based on the Obermatt Method. As only half of the consolidated Obermatt Ranks exhibit excellent performance, the picture is ambiguous. Growth is above-average (Growth Rank of 70), and the company is safely financed (Safety Rank of 82). However, professional market sentiment is low(Sentiment Rank of 36). The negative market view on Calavo may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to board the train, they may drive stock prices above reasonable levels. It is typical for growth companies to have low value ratings, because investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Calavo compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one hundred minus the growth rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value if the value rank is above 60. As market sentiment is low, you should be careful with paying more than market-average for this stock and conduct further research into the company’s future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for Calavo only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 36 (better than 36% compared with alternatives), overall professional sentiment and engagement for the stock Calavo is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Calavo. Analyst Opinions are at a rank of 53 (better than 53% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive and has a rank of 75 which means that currently, stock research experts are getting even more optimistic about investments in Calavo. But Market Pulse has a low rank of 11, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 89% of competitors). This is an essential sign of caution, as it could be the forebearer of bad news. Professional Investors are also somewhat absent with a rank of 26, which means that, currently, professional investors hold less stock in this company than in 74% of alternative investment opportunities. Pros tend to invest in other companies. This is expected if the company is of a smaller size (medium or smaller). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 36 (less encouraging than 64% compared with investment alternatives), Calavo has a reputation among professional investors that is below that of its competitors. While the general news feeds in the professional market are negative, the analyst recommendations are optimistic about the company, and even increase their ratings despite the negative news. This is an ambiguous situation with positive and negative signals from the professional side. Investors should be on the lookout for negative news but not worry too much about it as long as the overall news is still positive. ...read more
Value Strategy: Calavo Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 40 (worse than 60% compared with alternatives), Calavo shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for Calavo. Price-to-Sales (P/S) is 55, which means that the stock price compared with what market professionals expect for future sales is lower than for 55% of comparable companies, indicating a good value concerning Calavo's revenue size. The same is valid for dividend yields with a Dividend Yield rank of 55, which means that dividends are expected to be higher than for 55% of comparable investments. On the other hand, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is less favorable than for 57% of alternatives (only 43% of peers have an even higher ratio). The same is valid for the Price-to-Profit (or Price / Earnings, P/E) ratio, which is higher than for 53% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 40, is a hold recommendation based on Calavo's stock price compared with the company's operational size and dividend yields. This is a somewhat surprising picture, because it means that profits are low while dividends are high. One interpretation could be that profits are expected to increase, justifying the high dividend payments. But it could also mean that the company desperately keeps the high dividends to avoid a collapsing share price. This would be a rather dangerous constellation. ...read more
Growth Strategy: Calavo Growth Momentum good
| GROWTH METRICS | November 14, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 60 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 100 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 16 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 58 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 70 |
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ANALYSIS: With an Obermatt Growth Rank of 70 (better than 70% compared with alternatives), Calavo shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Calavo. Sales Growth has a rank of 60 which means that currently, professionals expect the company to grow more than 60% of its competitors. Both Profit Growth, with a rank of 100, and Stock Returns, with a rank of 58, are also above average. But Capital Growth only has a rank of 16, which means that, currently, professionals expect the company to grow its invested capital less than 84% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 70, is a buy recommendation for growth and momentum investors. That may be a good sign if the company is already well positioned and doesn't require more investments at this time. They may focus on growing the top (revenues) and bottom (profits) lines, recently rewarded with above-average stock returns for shareholders. But it may also be a sign of danger as the company is falling back with capital investment activities concerning competition. This requires further analysis of corporate communications. ...read more
Safety Strategy: Calavo Debt Financing Safety very solid
| SAFETY METRICS | November 14, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 83 |
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| REFINANCING | ||||||||
| REFINANCING | 74 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 43 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 82 |
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ANALYSIS: With an Obermatt Safety Rank of 82 (better than 82% compared with alternatives) for 2024, the company Calavo has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Calavo is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators where two out of three are above average for Calavo.Leverage is at 83, meaning the company has a below-average debt-to-equity ratio. It has less debt than 83% of its competitors.Refinancing is at a rank of 74, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 74% of its competitors. Liquidity is at 43, meaning that the company generates less profit to service its debt than 57% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 82 (better than 82% compared with alternatives), Calavo has a financing structure that is significantly safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: Calavo Top Financial Performance
| COMBINED PERFORMANCE | November 14, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 40 |
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| GROWTH | ||||||||
| GROWTH | 70 |
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| SAFETY | ||||||||
| SAFETY | 43 |
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| COMBINED | ||||||||
| COMBINED | 80 |
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ANALYSIS: With an Obermatt Combined Rank of 80 (better than 80% compared with investment alternatives), Calavo (Packaged Foods & Meats, USA) shares have much better financial characteristics than comparable stocks. Shares of Calavo are low in value (priced high) with a consolidated Value Rank of 40 (worse than 60% of alternatives). But they show above-average growth (Growth Rank of 70) and are safely financed (Safety Rank of 82, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 80, is a strong buy recommendation based on Calavo's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Calavo exhibits low value (Obermatt Value Rank of 40), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 70). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 82) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
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