Cal-Maine Foods Stock In Focus After Acquisition Of Deal-Rite Feeds: Retail’s Upbeat

Cal-Maine plans to fund the acquisition with available cash on hand.

​​Shares of Cal-Maine Foods Inc. ($CALM) rose 0.3% in after hours trading on Monday after hours following the company’s acquisition of certain assets of Deal-Rite Feeds Inc. and its affiliated entities, lifting retail sentiment.

The purchase includes two feed mills, storage facilities, usable grain, vehicles, related equipment and retail feed sales business located in Statesville and Union Grove, North Carolina, according to a company statement.

Cal-Maine plans to fund the acquisition with available cash on hand.

“We are pleased to have the opportunity to acquire these feed mills and operations, which are strategically located in close proximity to our North Carolina shell egg production facilities,” Sherman Miller, president and CEO of Cal-Maine Foods, said. “As we continue to expand contract production in this area, we also look for ways to effectively manage our production costs and drive efficiencies.”

Miller noted that feed is a primary cost component in the production of shell eggs, and the quality and composition of feed are critical factors related to the health of our hens and the nutritional value of shell eggs.

The addition of these feed mill operations in North Carolina, will help the company formulate, produce and deliver feed at a lower cost with shorter travel required to reach the respective farms.

Sentiment on Stocktwits improved to ‘extremely bullish’ from ‘bullish’ a week ago. Message volumes also climbed into the ‘high’ category from normal.

Cal-Maine Foods posted earnings per share of  $4.47, beating Wall Street estimates of $4.05. Its revenues came in at $954.7 million, beating estimates of $751.49 million, according to Stocktwits data.  

Cal-Maine Foods stock is up 3.67% year-to-date.

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