Re:Record-Breaking Egg Profits Prompt Accusation of Price Go...
by webdood90 on Wednesday February 22, 2023 @01:20PM
(#34900166)
Why do people shill for corporations?
Re:Record-Breaking Egg Profits Prompt Accusation of Price Go...
by lotsofpulp on Wednesday February 22, 2023 @01:26PM
(#34900256)
Nobody was complaining about low egg prices when Cal-Maine was reporting losses and meager profit margins in 2017 and 2019 to 2021.
But that is beside the point that there is no set nominal “appropriate” profit margin for a given business.
That does not mean that businesses with high profit margins are not colluding, or corrupt, or acting in ways that should be illegal.
But it also means you cannot simply conclude from a few quarters of higher profit margins that a business is behaving unethically.
https://www.macrotrends.net/stocks/charts/CALM/cal-maine-foo...
> For the 26-week fiscal period ending in November 2021, gross profits were $50.4 million. In 2022 for the same period, gross profits were $535.3 million.
They had a near zero profit margin for 2021. And based on their record of profit margins, it seems like their business has been volatile since 2015 or so.
I am not an expert on the egg business or food in general, but there is no reason that a 10x increase in profit has to mean malfeasance.
Volatile businesses can have large swings in profit margin, otherwise no one would want to do them.