Surging egg prices send Cal-Maine's profit, shares higher
(Reuters) - Shares of Cal-Maine Foods climbed almost 4% late on Tuesday after the leading U.S. egg producer reported a surge in quarterly profit as it benefited from soaring prices amid the deadliest bird flu outbreak in U.S. history.
After the bell, the Jackson, Mississippi-based company - the only major publicly-traded egg producer - reported net sales of $997.5 million for its fiscal quarter ending in February, up 109% year over year.
That beat the $888.2 million average estimate of three analysts, according to Refinitiv.
Cal-Maine, which controls about 20% of the U.S. egg market, Cal reported net income of $323.2 million, a seven-fold rise from the same quarter last year.
Cal-Maine said there were no positive tests for bird flu at any its egg production facilities.
Avian flu outbreak leads to record bird losses, https://www.reuters.com/graphics/USA-STOCKS/CALMAINE/znpnblojbpl/chart.png
Avian flu has wiped out nearly 58 million birds in the United States since the start of 2022, according to the Centers for Disease Control and Prevention, driving up prices for chicken, eggs and other poultry products.
The average price of a dozen eggs in the United States stood at $4.11 in February, up from about $2 in February 2022, according to the St. Louis Federal Reserve.
Last month, two U.S. lawmakers sent letters to the country's top egg companies, questioning whether the soaring cost of eggs is "a legitimate response to reduced supply or out-of-control corporate greed".
The company says it sets its prices based on independently published market quotes.
Surging egg prices helped drive Cal-Maine's stock up almost 50% last year, even as the S&P 500 tumbled 19%. The company's stock has fallen about 16% so far in 2023.
(Reporting by Noel Randewich, editing by Deepa Babington)