Analysts see 29% upside for AVO as gross margins rose 190 basis points despite a 30% price drop in fiscal Q1.
Mission Produce (AVO) reported fiscal Q1 gross margin expansion of 190 basis points, defying a 30% decline in avocado prices. The company absorbs pricing shocks better than expected, with 85% of revenue tied to avocados.
A supply glut from Mexico, which accounts for 80% of U.S. avocado imports, drove the price collapse. Sales fell 20% in the first half, pushing the stock down 16% from April highs. However, a record Peruvian harvest and management’s upbeat guidance signal a turnaround.
Analysts set a $16.50 price target for AVO, citing 29% upside from current levels. Insider and institutional buying, including elite funds, supports the outlook.