CALM

Cal-Maine just printed a generational year: FY2025 revenue of $4.26B (+83% YoY) and net income of $1.22B (+339% YoY) on a net average shell egg price of $3.134 vs $1.932 prior — a 62% price lift the MD&A explicitly attributes to HPAI outbreaks decreasing supply during peak seasonal demand. The Urner Barry SE large index was up 118.3% YoY. This is not durable earnings power; it is a supply-shock windfall. The 3.2x P/E and 0.9x P/S optically scream cheap, but that's the textbook cyclical-peak trap — the right multiple on normalized earnings (closer to FY22's $133M or FY24's $278M) implies a much higher real P/E.

That said, the balance sheet is pristine and management is using the windfall well. Liabilities/equity of 0.20x, $499M cash, essentially no long-term debt, current ratio of 6.4, and $1.22B in operating cash flow give the company optionality. Management returned $330M in dividends (variable policy), authorized a $500M repurchase program in Feb 2025, and deployed cash into ISE, Deal-Rite, and the $258M post-period Echo Lake Foods acquisition — moving toward value-added products and away from pure shell-egg cyclicality. The 18% increase in average layer hens, 56% jump in chicks hatched, and 48% larger breeder flock are explicit capacity adds that, ironically, will compress the very prices driving today's earnings.