Definitive Analysis
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Calavo Growers, Inc. (CVGW)

Company Dividend Discount ModelIndustry: Food DistributionSector: Consumer Defensive

Valuation Snapshot

Stable Growth$3.47 - $4.51$4.02
Multi-Stage$7.95 - $8.77$8.35
Blended Fair Value$6.18
Current Price$26.30
Upside-76.49%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS-12.68%-2.08%0.500.581.141.141.080.980.930.880.780.73
YoY Growth---14.49%-48.68%-0.06%5.11%10.17%5.47%6.12%12.86%7.22%17.86%
Dividend Yield--2.18%2.24%3.55%2.75%1.40%1.28%1.15%1.01%1.41%1.36%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)19.88
(-) Cash Dividends Paid (M)14.30
(=) Cash Retained (M)5.58
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)3.982.481.49
Cash Retained (M)5.585.585.58
(-) Cash Required (M)-3.98-2.48-1.49
(=) Excess Retained (M)1.613.104.09
(/) Shares Outstanding (M)17.8717.8717.87
(=) Excess Retained per Share0.090.170.23
LTM Dividend per Share0.800.800.80
(+) Excess Retained per Share0.090.170.23
(=) Adjusted Dividend0.890.971.03
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-13.17%-12.17%-11.17%
Fair Value$3.47$4.02$4.51
Upside / Downside-86.80%-84.72%-82.85%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)19.8817.4615.3413.4711.8310.3910.70
Payout Ratio71.92%75.54%79.15%82.77%86.38%90.00%92.50%
Projected Dividends (M)14.3013.1912.1411.1510.229.359.90

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-13.17%-12.17%-11.17%
Year 1 PV (M)11.9512.0912.23
Year 2 PV (M)9.9710.2010.43
Year 3 PV (M)8.308.598.88
Year 4 PV (M)6.897.217.55
Year 5 PV (M)5.716.056.40
PV of Terminal Value (M)99.21105.05111.17
Equity Value (M)142.03149.19156.66
Shares Outstanding (M)17.8717.8717.87
Fair Value$7.95$8.35$8.77
Upside / Downside-69.78%-68.26%-66.67%

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