Cal-Maine Foods Inc., the nation’s largest egg producer, on April 8 acknowledged that it is being investigated by the Department of Justice’s Antitrust Division over the national increase in egg prices.
The brief admission in its newest financial report made headlines, and the company’s shares fell by about 4 percent in after-hours trading.
Egg prices have hit record highs in recent months, largely because of a bird flu epidemic that has forced farmers to slaughter more than 166 million birds, mostly egg-laying chickens.
One dozen Grade A eggs cost an average of $5.90 in U.S. cities in February, up 10.4 percent from a year ago. That eclipsed January’s record-high price of $4.95.
New Earnings Report
Cal-Maine released its financial result for its third quarter, which ended March 1, on April 8, showing that it brought in robust earnings: $508 million, or $10.38 per share, a 245 percent jump from earnings of $146.4 million, or $3.01 per share, a year ago. It reported sales of $1.4 billion in the quarter, up 99 percent from $703.1 million year over year.
Cal-Maine also announced that it signed an agreement before the end of the third quarter to acquire Echo Lake Foods for about $258 million.
Commenting on the results, Cal-Maine President and CEO Sherman Miller said dynamic market conditions, which led to record-high egg prices and bird flu-related shortages, persisted throughout the quarter.
Miller said that despite the challenging supply environment, the company was able to benefit from its existing size plus recent acquisitions to increase capacity.
“Above all, we stayed focused on meeting the needs of our valued customers, while honoring our longstanding pricing frameworks,” he said in a statement.
“Alongside our own efforts to address the current supply situation, we greatly appreciate the current administration’s recently announced plan to address the volatility in our vital industry,” Miller said.
“It is clear the administration recognizes the importance of eggs as a low-cost, high-value, unprocessed protein for feeding our nation’s families.”
Company officials said the strong third-quarter performance was primarily driven by an 80.7 percent increase in net average selling price per dozen eggs and a 10.2 percent increase in volume.
For the quarter, Cal-Maine’s net average selling price per dozen was $4.06, compared with $2.25 a year ago. The company sold a record 331.4 million dozen shell eggs, a 10.2 percent increase.
Concerning the Echo Lake acquisition, Miller said the deal represents “an exciting growth opportunity and important inflection point for Cal-Maine Foods,” allowing the Mississippi egg producer to diversify its product portfolio and customer mix.
“Echo Lake Foods is a leading innovator with a long history of providing quality ready-to-eat egg products and breakfast foods to a blue-chip customer base,” Miller said.
“The combined product lines and capabilities of the two companies are highly complementary and, importantly, we share similar values of pursuing operating excellence and meeting the needs of our customers.”
In 2024, Echo Lake had annual revenues of about $240 million, with a five-year annual growth of approximately 10 percent.
Looking ahead to the rest of 2025, Cal-Maine officials say the industry is prone to volatility because of external factors such as bird flu, rising production costs, and changes in consumer demand.
As the key barometer for inflation, the CPI measures changes in the price level of a weighted average market basket of consumer goods and services that most U.S. households purchase. Through February, the annual inflation rate in the United States eased to 2.8 percent from 3 percent in January, below market expectations of 2.9 percent.
During the trading session on April 8 on the Nasdaq Stock Exchange, Cal-Maine shares fell in tandem with the broader sell-off on Wall Street. At the closing bell, the stock was down $3.12, or 3.34 percent, at $90.33, with more than 1.9 million shares traded, twice the normal volume.
