Goldman Sachs Starts Cal-Maine Foods (CALM) at Neutral

Goldman Sachs analyst Leah Jordan initiates coverage on Cal-Maine Foods (NASDAQ: CALM) with a Neutral rating and a price target of $110.00.

The analyst comments: "As the largest producer and distributor of fresh eggs in the US, CALM has benefited recently from a favorable industry backdrop with higher egg prices amid tight supply due to elevated disease impacts (HPAI/bird flu). However, we expect egg fundamentals to normalize over the coming year as the supply backdrop improves with a recovery in the flock, coupled with a continuation of solid demand given eggs are a low-cost protein source. Specifically, CALM's stock price has a strong correlation to egg prices, noting the average egg selling price has been the primary driver of profitability, although we expect margin variability to moderate over time as the company shifts toward more value-added products. All in, we believe this backdrop is well understood and embedded in FactSet consensus; thus, we see a balanced risk/reward after recent stock outperformance resulted in a full valuation."

For an analyst ratings summary and ratings history on Cal-Maine Foods click here. For more ratings news on Cal-Maine Foods click here.

Shares of Cal-Maine Foods closed at $109.65 yesterday.

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