Freedom: Mission Produce Loses Revenue but Plans Recovery within Six Months

Mission Produce (AVO) reported Q2 FY2026 performance under pressure from low prices and declining business profitability. However, Freedom analysts believe the situation is temporary and expect a significant improvement in the company’s financial performance in the second half of the year. Freedom maintains its Buy recommendation with a target price of $15.

Mission Produce is one of the world’s largest avocado suppliers. The company is engaged in cultivating, sourcing, packaging, and distributing avocado products, and recently expanded its business through the acquisition of Calavo, a major U.S. agricultural company.

Mission Produce’s Q2 revenue declined by 24% YoY to $290.9 million. The main reason was a 36% drop in average avocado selling prices, which could not be offset by a 15% increase in sales volume. Against this backdrop, adjusted EBITDA fell from $19.1 million to $7.1 million, and gross margin declined to 7%.

The key strategic event of the quarter was the Calavo acquisition. The deal expands Mission Produce’s presence in the North American market and enables entry into the ready-made food segment, including guacamole and sauces. Management expects synergies exceeding $25 million, with benefits beginning to materialize by the end of the current fiscal year.

Freedom analysts note that management anticipates a marked improvement in financial performance in the second half of the year. The company forecasts adjusted EBITDA of $84–88 million in the second half, driven by margin recovery, improved market conditions, Peru’s peak harvest season, and contributions from the newly acquired Calavo business.

An additional positive signal for investors was the announcement of a new $100 million share buyback program. According to Freedom analysts, this reflects management’s confidence in the company’s long-term prospects despite current challenges.

Not an individual investment recommendation.