Calavo Growers Inc (NASDAQ: CVGW)

Sector: Consumer Defensive Industry: Food Distribution CIK: 0001133470
Market Cap 453.82 Mn
P/B 1.77
P/E -33.31
P/S 0.43
ROIC (Qtr) 11.33
Div Yield % 5.20
Rev 1y % (Qtr) -26.64
Total Debt (Qtr) 23.47 Mn
Debt/Equity (Qtr) 0.11
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About

Investment thesis

Bull case

  • Strong operating cash flow of 21.54M provides robust 0.92x coverage of total debt 23.47M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 61.16M provide 13.73x coverage of short-term debt 4.45M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 21.54M provides exceptional 123.80x coverage of minority interest expenses 174000, showing strong core operations.
  • Strong tangible asset base of 282.04M provides 12.02x coverage of total debt 23.47M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 21.54M provides exceptional 26.05x coverage of interest expenses 827000, showing strong debt service capability.

Bear case

  • Operating cash flow of 21.54M barely covers its investment activities of (2.15M), with a coverage ratio of -10.01, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 21.54M provides thin coverage of dividend payments of (14.29M) with a -1.51 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Free cash flow of 19.39M represents just -20.83x of debt issuance (931000), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • R&D investment of 0 represents just 0x of SG&A expenses of 42.09M, indicating potential underinvestment in innovation relative to administrative overhead.
  • High receivables of 44.72M relative to operating cash flow of 21.54M, which is 2.08x indicates potential revenue recognition or collection issues.

Segments Breakdown of Revenue (2025)

Concentration Risk Type Breakdown of Revenue (2025)

Peer comparison

Companies in the Food Distribution
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 SYY Sysco Corp 52.49 Bn 48.75 1.21 14.97 Bn
2 USFD US Foods Holding Corp. 22.03 Bn 32.59 0.56 5.37 Bn
3 PFGC Performance Food Group Co 15.24 Bn 44.17 0.23 7.99 Bn
4 CHEF Chefs' Warehouse, Inc. 2.62 Bn 35.11 0.65 0.95 Bn
5 UNFI United Natural Foods Inc 2.38 Bn -23.56 0.07 3.47 Bn
6 ANDE Andersons, Inc. 1.88 Bn 20.94 0.34 0.77 Bn
7 AVO Mission Produce, Inc. 1.03 Bn 27.23 0.74 0.20 Bn
8 CVGW Calavo Growers Inc 0.45 Bn -33.31 0.43 0.02 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.88 1.05
EV to Cash from Ops. EV/CFO 18.99 34.23
EV to Debt EV to Debt 23.37 13.37
EV to EBIT EV/EBIT -32.18 164.56
EV to EBITDA EV/EBITDA 11.32 4.40
EV to Free Cash Flow [EV/FCF] EV/FCF 31.27 22.08
EV to Market Cap EV to Market Cap 1.21 1.45
EV to Revenue EV/Rev 0.52 0.53
Price to Book Value [P/B] P/B 1.77 2.85
Price to Earnings [P/E] P/E -33.31 13.20
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 1.39 0.57
Dividend Payout Ratio % Div Payout % (Qtr) 72.10 21.05
Dividend per Basic Share Div per Share (Qtr) 0.80 0.44
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 73.60 8.21
Interest Coverage Int. cover (Qtr) 30.56 7.20
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 25.57 -12.24
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 7.23 35.81
Dividend Growth (1y) % Div 1y % (Qtr) 14.29 32.53
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 673.55 65.49
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 4.93 -8.59
EBIT Growth (1y) % EBIT 1y % (Qtr) 510.07 21.40
EBT Growth (1y) % EBT 1y % (Qtr) 1,856.93 -278.84
EPS Growth (1y) % EPS 1y % (Qtr) 1,950.00 -67.04
FCF Growth (1y) % FCF 1y % (Qtr) -9.93 82.95
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -6.11 1.59
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 2.22 2.79
Cash Payout Ratio Cash Payout (Qtr) 0.60 0.07
Cash Ratio Cash Ratio (Qtr) 1.01 0.34
Current Ratio Curr Ratio (Qtr) 2.47 2.65
Debt to Equity Ratio Debt/Equity (Qtr) 0.11 1.41
Interest Cover Ratio Int Coverage (Qtr) 30.56 7.20
Times Interest Earned Times Interest Earned (Qtr) 30.56 7.20
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 5.00 4.45
EBIT Margin % EBIT Margin % (Qtr) 3.90 8.39
EBT Margin % EBT Margin % (Qtr) 3.77 4.17
Gross Margin % Gross Margin % (Qtr) 9.80 24.60
Net Profit Margin % Net Margin % (Qtr) 3.10 3.22