Earnings Preview: Eggs For Breakfast And Marijuana To Chill

I personally love eggs and weed and have small positions in leading egg producer Cal Maine Foods (CALM) and marijuana producer Tilray (TLRY). Both are $2 billion market cap companies.

Freepik

The former reports Tuesday afternoon and the latter Wednesday morning.

CALM stock was on fire in 2022 – as you can see in the chart above – driven by surging egg prices due to chicken flu and input inflation. CALM’s revenue increased 77% for the fiscal year ended June 3, 2023 and diluted EPS increased to $15.52 from $2.72. While egg prices have since come down, they are still quite high and therefore CALM’s results should continue to be excellent as well. Eggs are a staple of many people’s diets – including mine – and the stock is priced way to cheap IMO. I’ll hold my shares into their earnings report Tuesday afternoon.

TLRY has been in a long and massive downtrend over the last few years since acting like a meme stock at the beginning of 2021. As a result, most people have forgotten about it but the fundamentals are starting to be there. Last quarter, TLRY guided EBITDA for the year ended May 31, 2024 (its FY24) to $68-$73 million. In other words, TLRY is now solidly profitable on this basis. I think shares are worth a small speculative position – as is the Marijuana ETF (MJ) – due to the increasing prevalence, acceptability and legality of marijuana that is only likely to increase going forward. I’ll hold my shares into earnings Wednesday morning.

 


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