Whole Foods Market, Inc. (WFM): Why Calavo Growers, Inc. (CVGW) Earnings Could Get Greener

One question facing Calavo Growers, Inc. (NASDAQ:CVGW) is whether its expected gains from what it called “blue-chip customers” will lead to better results. The company didn’t name those customers, but the fresh-food trend has arguably made Whole Foods Market, Inc. (NASDAQ:WFM) the most desirable target for any fruit producer to seek a growing relationship. Up-and-coming competitor Limoneira Company (NASDAQ:LMNR) is a direct threat, selling avocados as well as various citrus fruits, but so far, both companies have enjoyed substantial sales gains in a generally favorable environment for the industry.

In the Calavo Growers, Inc. (NASDAQ:CVGW) earnings report, look to see whether the company’s anticipated gains actually lead to better profits. Sales growth is a good sign of demand, but in order for investors to see share-price gains, Calavo will have to demonstrate its ability to get costs under control and move margins back upward to pull more of its revenue down to the bottom line.

The article Why Calavo Earnings Could Get Greener originally appeared on Fool.com and is written by Dan Caplinger.

Fool contributor Dan Caplinger has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Whole Foods Market. 

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