Cal-Maine
CALM
$82.80
+0.45%
Cal-Maine Foods Inc is the largest producer and distributor of shell eggs in the United States, offering a diverse portfolio that includes conventional, cage-free, organic, and nutritionally enhanced eggs, serving retail grocery chains, club stores, and foodservice distributors nationwide. As the dominant player in a fragmented industry, Cal-Maine leverages its scale, vertical integration, and strategic acquisitions to maintain market leadership. The current investor narrative centers on the company's ability to navigate volatile egg prices, with recent quarterly results showing a steep revenue decline due to lower prices, yet the company beat profit expectations and signaled market stabilization. Additionally, Cal-Maine's cash-funded acquisition of Creighton Brothers LLC in March 2026 underscores its growth strategy and commitment to expanding its Midwest footprint, while investors debate the sustainability of earnings in a post-avian-flu environment.…
CALM
Cal-Maine
$82.80
Related headlines
Investment Opinion: Should I buy CALM Today?
Based on the analysis, I rate Cal-Maine as a Hold. The stock offers a high dividend yield and a low trailing P/E, but the forward valuation is fair, and the earnings outlook is uncertain. The analyst consensus is neutral, with an average target of $88.00, implying modest upside. The thesis is that Cal-Maine is a well-managed leader in a cyclical industry, but the current earnings downturn may not be fully reflected in the forward multiple.
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CALM 12-Month Price Forecast
The AI assessment is neutral, reflecting the balanced risks and opportunities. The stock's low beta suggests it is less sensitive to market swings, but its earnings are highly cyclical. The wide gap between trailing and forward P/E indicates market skepticism about earnings sustainability. If egg prices stabilize and the company beats estimates, the stance could turn bullish; conversely, further price declines would reinforce bearishness. Monitoring quarterly earnings and egg price trends will be crucial.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Cal-Maine's 12-month outlook, with a consensus price target around $88.00 and implied upside of +6.3% versus the current price.
Average Target
$88.00
0 analysts
Implied Upside
+6.3%
vs. current price
Analyst Count
—
covering this stock
Price Range
$79 - $100
Analyst target range
Analyst coverage is limited, with only 4 analysts providing targets, and the consensus recommendation is 'none' (no clear buy/sell consensus). The average target price is $88.00, implying a 6.28% upside from the current price of $82.80. The distribution is not provided, but the average suggests a neutral to slightly bullish stance, with targets ranging from a low of $79.00 (4.59% downside) to a high of $100.00 (20.77% upside). The wide spread between low and high targets (21 points) indicates high uncertainty about the company's earnings trajectory, reflecting the volatility of egg prices and the impact of avian flu. Recent ratings actions have been neutral, with firms like Stephens & Co. and BMO Capital maintaining Equal Weight and Market Perform ratings, respectively, while Goldman Sachs has a Neutral rating. This pattern suggests analysts are cautious, waiting for clearer evidence of margin stabilization before becoming more constructive.
Bulls vs Bears: CALM Investment Factors
Cal-Maine presents a classic cyclical investment case. The bull case rests on its dominant market position, pristine balance sheet, and attractive trailing valuation, while the bear case highlights the severe revenue decline, elevated forward multiple, and weak price momentum. Currently, the bearish evidence is stronger given the ongoing earnings normalization and lack of analyst conviction. The most critical tension is whether egg prices have stabilized or will continue to fall, as this determines whether the low trailing P/E is a value trap or a genuine opportunity. If prices stabilize and the company maintains profitability, the stock could re-rate; if not, further downside is likely.
Bullish
- Dominant market position: Cal-Maine is the largest U.S. shell egg producer with a diverse portfolio including conventional, cage-free, organic, and nutritionally enhanced eggs. Its scale and vertical integration provide cost advantages and pricing power, supporting long-term market leadership.
- Strong balance sheet: The company has zero debt (debt-to-equity ratio of 0) and a current ratio of 7.70, indicating ample liquidity. This financial strength enables strategic acquisitions like Creighton Brothers, funded entirely with cash, without increasing leverage.
- Attractive trailing valuation: With a trailing P/E of 11.24x versus the industry average of 22x, the stock trades at a 49% discount. This low multiple reflects current elevated earnings but offers a margin of safety if earnings normalize less than feared.
- High dividend yield: The dividend yield stands at 6.51%, supported by a payout ratio of 73.1%. This provides a substantial income component, which is attractive for income-focused investors and cushions total return during price volatility.
Bearish
- Severe revenue decline: Q3 FY2026 revenue fell 52.95% year-over-year to $666.95 million from $1.42 billion, reflecting a sharp drop in egg prices post-avian flu. This decline highlights the cyclicality and volatility of the egg market, making earnings unpredictable.
- Elevated forward valuation: The forward P/E of 23.10x is roughly in line with the industry average, implying the market expects a significant earnings decline. This suggests that current earnings are not sustainable, and the stock may not be as cheap as trailing metrics indicate.
- Weak price momentum: The stock is down 26.89% over the past year, significantly underperforming the S&P 500's +20.48% gain. It trades near the lower end of its 52-week range (24.5% of the range), indicating persistent selling pressure and negative investor sentiment.
- Analyst caution: With only 4 analysts covering the stock and a consensus recommendation of 'none', there is no clear buy signal. The average target price of $88.00 implies just 6.28% upside, and recent ratings from Stephens, BMO, and Goldman are neutral, reflecting uncertainty.
CALM Technical Analysis
Cal-Maine's stock is in a pronounced downtrend over the past year, with a 1-year price change of -26.89%, significantly underperforming the S&P 500's +20.48% gain. The current price of $82.80 sits at 24.5% of its 52-week range (between $71.92 low and $117.45 high), indicating the stock is trading near the lower end of its yearly range, which often suggests either a value opportunity or a falling knife, depending on fundamental catalysts. The stock has been range-bound between roughly $74 and $93 over the past six months, with the 52-week high of $117.45 reached in late 2025, followed by a sharp decline.
Beta
0.23
0.23x market volatility
Max Drawdown
-39.2%
Largest decline past year
52-Week Range
$72-$117
Price range past year
Annual Return
-26.9%
Cumulative gain past year
| Period | CALM Return | S&P 500 |
|---|---|---|
| 1m | -5.8% | +3.6% |
| 3m | +7.5% | +2.7% |
| 6m | -1.2% | +11.4% |
| 1y | -26.9% | +18.7% |
| ytd | +5.5% | +12.3% |
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CALM Fundamental Analysis
Revenue has been highly volatile, with the most recent quarter (Q3 FY2026, ended February 28, 2026) reporting $666.95 million, a 52.95% decline year-over-year from $1.42 billion in the prior-year quarter. This steep drop reflects lower egg prices following the avian flu-driven spike, and the multi-quarter trend shows deceleration: Q1 FY2026 revenue was $922.60 million, Q2 was $769.50 million, and Q3 fell to $666.95 million. The revenue decline is primarily due to lower conventional egg prices, partially offset by growth in specialty eggs, which contributed $328.94 million in sales. The investment case hinges on whether the company can stabilize volumes and prices, with management signaling a return to market stability.
Quarterly Revenue
$666951000.0B
2026-02
Revenue YoY Growth
-52.9%
YoY Comparison
Gross Margin
17.9%
Latest Quarter
Free Cash Flow
$722862000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is CALM Overvalued?
Given that Cal-Maine is profitable, I selected the trailing P/E ratio as the primary valuation metric. The trailing P/E is 11.24x, while the forward P/E is 23.10x, implying the market expects a significant decline in earnings over the next year, consistent with the normalization of egg prices. The gap between trailing and forward multiples suggests that current earnings are elevated and not sustainable, leading to a higher forward multiple. Compared to the industry average P/E of 22x (based on available data), Cal-Maine trades at a 49% discount on trailing earnings, but on forward earnings it is roughly in line. This discount reflects the cyclicality of egg prices and the market's skepticism about earnings durability.
PE
11.2x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 2x~20x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
7.4x
Enterprise Value Multiple
Investment Risk Disclosure
Financially, Cal-Maine faces significant earnings volatility due to its dependence on egg prices. The 52.95% revenue decline in Q3 FY2026 and the drop in EPS from $10.42 to $1.07 year-over-year illustrate the impact of price normalization. While the company has no debt and a strong cash position, its high payout ratio of 73.1% could strain dividends if earnings fall further. Additionally, the forward P/E of 23.10x suggests the market expects lower earnings, and any shortfall could lead to multiple compression. The company's revenue concentration in shell eggs, particularly conventional eggs, exposes it to price swings and supply disruptions from avian flu outbreaks, which are unpredictable and can cause sudden losses.
FAQ
The key risks are: 1) Financial risk from earnings volatility, as seen in the 52.95% revenue decline and EPS drop from $10.42 to $1.07; 2) Market risk from egg price fluctuations and avian flu outbreaks, which can cause sudden supply disruptions; 3) Competitive risk from larger players or substitutes, though Cal-Maine's scale mitigates this; 4) Macro risk from feed costs and inflation, which could compress margins. The most severe risk is a prolonged downturn in egg prices, which could lead to a dividend cut and further stock decline.
The 12-month forecast is mixed. The bull case (25% probability) targets $88-$100, driven by price stabilization and successful acquisitions. The base case (50% probability) targets $79-$88, assuming current conditions persist. The bear case (25% probability) targets $72-$79, if prices fall further. The most likely scenario is the base case, with the stock trading around $88, but the wide range reflects high uncertainty. Investors should monitor quarterly earnings and egg price trends for signs of direction.
On trailing earnings, Cal-Maine appears undervalued with a P/E of 11.24x versus the industry average of 22x, a 49% discount. However, on forward earnings, the P/E of 23.10x is in line with the industry, indicating the market expects a significant earnings decline. This suggests the stock is fairly valued based on normalized earnings, but the market is pricing in a cyclical downturn. The low P/B of 1.35x and P/S of 1.22x also indicate a value-oriented valuation. Overall, the stock is not a bargain on forward metrics, but the trailing discount reflects the cyclical peak.
Cal-Maine is a good buy for investors seeking a high dividend yield (6.51%) and a low trailing P/E (11.24x), but they must accept the cyclicality of egg prices. The stock offers a modest 6.28% upside to the average analyst target of $88, but the forward P/E of 23.10x suggests limited upside if earnings decline. The biggest risk is further price drops, which could push the stock to the 52-week low of $71.92, a 13.1% downside. For risk-tolerant income investors, it could be a buy; for growth investors, it is less attractive.
Cal-Maine is more suitable for long-term investment due to its cyclical nature and high dividend yield. The stock's low beta (0.225) indicates low correlation with the market, making it a defensive holding, but its earnings are volatile. Short-term trading is risky given the unpredictable egg prices and the stock's recent downtrend. A minimum holding period of 3-5 years is recommended to ride out the cycle and benefit from the dividend income. For income investors, the 6.51% yield provides a cushion, but capital appreciation may be limited.