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Dole Sinks 11% on Mixed Q1 Performance
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Dole Sinks 11% on Mixed Q1 Performance

Dole plc (NYSE: DOLE) is one of the world’s major producers of fresh fruits and vegetables. Specifically, it is among the big industry players in the production of fresh bananas and pineapples, along with leading in value-added salads and fresh-packed vegetables. 

With strong economies of scale resulting in operating efficiencies, the company is also striving to be recognized in categories like berries, avocados, and organic produce.  

Recently, Dole reported mixed results for the first quarter of 2022. Additionally, it provided a decent outlook for the full year of 2022. 

Following the update, shares of Dole lost almost 11% at the close on Tuesday. Meanwhile, the stock rose 2.72% after-hours. 

Results in Detail 

Total revenues of $2.2 billion decreased slightly on a year-over-year basis and missed analysts’ expectations of $2.3 billion. Revenues were impacted due to a decline in the Fresh Vegetables segment and unfavorable foreign currency movements. 

Meanwhile, Dole registered first-quarter adjusted earnings per share of $0.30, above the consensus estimate of $0.29. The company reported adjusted earnings of $0.62 per share in the same quarter last year. Adjusted EBITDA stood at $81.5 million, down 37.8% year-over-year. 

Segment-wise, Fresh Fruit contributed revenues of $749.8 million, up marginally on a year-over-year basis, while revenues of $791.2 million at Diversified Fresh Produce – EMEA were almost in line. Additionally, the Diversified Fresh Produce – Americas & ROW segment recorded revenues of $463.7 million, up 10%. 

On the flip side, revenues from Fresh Vegetables declined 16.2% to $274.8 million. The recall of packaged salads and temporary plant closures impacted the volumes of value-added salad products, resulting in lower revenues. 

Outlook 

For 2022, the company projects total revenues in the range of $9.4 billion to $9.7 billion against the consensus estimate of $9.7 billion. Adjusted EBITDA is expected in the range of $350 million to $370 million, down from prior expectations of $370 million to $380 million on macroeconomic issues. 

Wall Street’s Take 

The Street is cautiously optimistic about the stock, with a Moderate Buy consensus rating based on 2 Buys. The average Dole price target of $19.50 implies 96.77% upside potential. 

Smart Score 

According to TipRanks’ Smart Score system, Dole gets a 5 out of 10, which indicates that the stock is likely to perform in line with market averages. 

Concluding Remarks 

Currently, trading near its 52-week low price, Dole has lost almost 26% so far this year. Therefore, investors buying the dips could consider investing in the stock, since it performed well last year and has a strong market position in the industry. 

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