Mission Produce, Inc.

Where It Passes

Where It Falls Short

• Valuation models9% pass✓ 1✗ 10▾

  Models split on AVO at $11.83 — fair values range $1.58–$15.89

  Graham fair value$9.96

  ✗Graham-18.8% margin vs $11.83

  Buffett fair value$4.42

  ✗Buffett-167.6% margin vs $11.83

  Lynch fair value$1.76

  ✗Lynch-572.2% margin vs $11.83

  Greenblatt fair value$5.14

  ✗Greenblatt-130.2% margin vs $11.83

  Dreman fair value$5.05

  ✗Dreman-134.3% margin vs $11.83

  Munger fair value$9.53

  ✗Munger-24.1% margin vs $11.83

  Pabrai fair value$1.58

  ✗Pabrai-648.7% margin vs $11.83

  Akre fair value$8.97

  ✗Akre-31.9% margin vs $11.83

  Marks fair value$5.85

  ✗Marks-102.2% margin vs $11.83

  Ackman fair value$15.89

  ✓Ackman+25.6% margin vs $11.83

  Templeton fair value$3.45

  ✗Templeton-242.9% margin vs $11.83
• Valuation15% pass✓ 7✗ 21▾

  11 of 13 flag AVO's valuation — Graham, Lynch, Greenblatt +8 more

  Price / Book Value per Share1.4x

  ✗Dreman< 1.2x✓Templeton< 1.5x✗SchlossP/B <= 0.80x (app cutoff)

  Price / 3-yr avg EPS35.1x

  ✗Graham<= 15x

  Price-to-Book Ratio1.4x

  ✓Graham<= 1.5x

  P/E x P/B49.90

  ✗Graham<= 22.5

  Basic earnings-growth PEG (dividends excluded)6.71

  ✗Lynch< 1.0 (ideally < 0.5)

  EBIT / Enterprise Value1.7%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=1.7%, ROC=2.9%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Price / EPS22.3x

  ✗Dreman< 12x✗Templeton< 12x (fixed ceiling; proxy for the market's cheapest 40%)

  Price / (CFO / Shares)9.4x

  ✗Dreman< 8x

  Valuation ReasonablenessP/E=22.3x, OE Yield=2.5%

  ✓MungerP/E < 25 or Owner Earnings Yield > 5%

  P/E or FCF YieldP/E=22.3x, FCF Yield=3.6%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  P/B or P/E vs. Historical AverageP/E=22.3x, P/B=1.4x

  ✓MarksP/E < 15 or P/B < 2.0

  Discount to Intrinsic Value-134.3% (IV=$5.05 vs Price=$11.83)

  ✗Marks>= 20% below intrinsic value

  Price / FCF per Share22.4x

  ✓Ackman<= 25

  Price vs. Trailing Low113% of trailing low ($10.48)

  ✓Templeton<= 120% of trailing low (certified split-adjusted live window)

  Net income / market capitalization+0.15%; #3149/6340 (top 49.7%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Positive book equity / market capitalization+0.7366; #2082/6449 (top 32.3%)

  ✗AsnessTop 30% of eligible cross-section

  Price / Diluted EPS22.3x

  ✗NeffP/E <= 15x (app proxy for a P/E 40%-60% below the market)

  (EPS CAGR % + Dividend Yield %) / P/E

  ✗Neff> 0.7 (Neff's published traditional edge)

  Price / Tangible Book Value per Share1.52x

  ✗SchlossP/TBV <= 1.00x (app cutoff)

  Book Value per Share Change+24.0%

  ✓SchlossLatest BVPS >= earliest BVPS over >= 3 years (app rule)

  Revenue / market capitalization+1.2904; #1505/5247 (top 28.7%)

  ✗OshaughnessyTop 10% of eligible cross-section

  (Operating cash flow - capex) / market capitalization-0.22%; #2569/4519 (top 56.8%)

  ✗OshaughnessyTop 10% of eligible cross-section

  Trailing six-month price return through the evaluation date-20.12%; #3973/6202 (top 64.1%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Profitability19% pass✓ 8✗ 27▾

  13 of 16 flag AVO's profitability — Graham, Buffett, Lynch +10 more

  Positive EPS (10 years)5/8 years positive

  ✗GrahamPositive EPS every year for 10 years

  EPS Growth (3-yr avg, 10-yr window)-57.4%

  ✗Graham>= 33% growth

  Net Income Positive (10+ years)5/8 years positive

  ✗BuffettPositive every year for 10+ years

  ROE (up to 5-year arithmetic mean)2.8%

  ✗Buffett> 15% arithmetic mean (app rule)

  Operating Margin (10-yr trend)4.7% (latest)

  ✗BuffettStable or rising over 10 years

  Free Cash Flow Proxy$37.7M

  ✗BuffettPositive and growing

  Earnings Variance (10-yr CoV)1.23

  ✗BuffettCoV < 0.3

  Retained Earnings Effectiveness

  ✗Buffett$1 retained -> > $1 market value created

  Basic earnings-growth PEG (dividends excluded)6.71

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR3.3%

  ✓Lynch15-30% (Fast Grower); > 0% to pass

  ROE0.2%

  ✗Lynch> 15%

  EBIT / Enterprise Value1.7%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=1.7%, ROC=2.9%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Net Income / Total Assets3.84%

  ✓PiotroskiROA > 0

  ROA Change YoY3.78% -> 3.84% (delta: +0.06%)

  ✓PiotroskiCurrent ROA > Prior ROA

  (CFO / Total Assets) vs ROACFO/Assets=9.01%, ROA=3.84%

  ✓PiotroskiCFO/Assets > ROA

  Gross Margin Change YoY12.4% -> 11.6%

  ✗PiotroskiImproved YoY

  Pre-Tax Income / Revenue1.1%

  ✗Dreman>= 8%

  Net Income / Shareholders' Equity0.2%

  ✗Dreman> 12%

  Margin of SafetyP/E=22.3x, P/B=1.4x

  ✓PabraiP/B < 1.5 or P/E < 15

  Return on Equity4.2% (3-yr avg)

  ✗AkreROE > 20% (3-year avg)

  Discount to Intrinsic Value-134.3% (IV=$5.05 vs Price=$11.83)

  ✗Marks>= 20% below intrinsic value

  Positive Net Income Frequency5/7 years positive

  ✗MarksPositive net income in >= 7 of last 10 years

  Operating Income / Revenue1.8%

  ✗Ackman>= 15%

  Net Income / Shareholders Equity0.2%

  ✗Ackman>= 15%

  5-Year EPS CAGR3.3% CAGR over 5 years

  ✓Templeton> 0% (5-year EPS CAGR)

  Operating Margin Trend0.7% (2023) -> 4.7% (2025)

  ✓TempletonNon-negative operating-margin trend over 3 years

  Revenue growth vs. gross and operating margin trendgross margin 8.7% -> 11.6%, operating margin 0.7% -> 4.7%

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  Net income / market capitalization+0.15%; #3149/6340 (top 49.7%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Gross profit / total assets+9.49%; #2839/3702 (top 76.7%)

  ✗AsnessTop 30% of eligible cross-section

  Net income / positive book equity+0.21%; #2891/5226 (top 55.3%)

  ✗AsnessTop 30% of eligible cross-section

  Negative 5-year standard deviation of ROA-0.0336; #2053/5884 (top 34.9%)

  ✗AsnessTop 30% of eligible cross-section

  3-5 Year Diluted EPS CAGR3.3% over 5 years

  ✗Neff7%-20% annualized

  Positive Diluted-EPS Years5/7 years positive

  ✓Schloss>= 70% positive over 5-10 observed years (app rule)
• Verdicts23% pass✓ 3✗ 10▾

  Split decision: 9 FAIL · 4 NEUTRAL · 2 PASS · 1 BUY

  Overall verdict

  ✗GrahamFAIL (2/9)✗BuffettFAIL (0/9)✗LynchFAIL (1/7)✗GreenblattRank #1740✓PiotroskiBUY (F-Score 8)✗DremanFAIL (3/11)✓MungerPASS (2/4)✗PabraiFAIL (1/3)✗AkreFAIL (1/6)✗MarksFAIL (2/5)✓AckmanPASS (5/9)•TempletonNEUTRAL (6/8)•SleepNEUTRAL (4/6)✗AsnessFAIL (Rank #1479/2370 (Top 62.4%))✗NeffFAIL (1/6)•SchlossNEUTRAL (4/7)•OshaughnessyNEUTRAL (Not ranked)
• Growth25% pass✓ 5✗ 8▾

  6 of 8 flag AVO's growth — Graham, Lynch, Dreman +3 more

  EPS Growth (3-yr avg, 10-yr window)-57.4%

  ✗Graham>= 33% growth

  Basic earnings-growth PEG (dividends excluded)6.71

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR3.3%

  ✓Lynch15-30% (Fast Grower); > 0% to pass

  Inventory Growth vs Revenue GrowthInv: 36.7% vs Rev: -6.2%

  ✗LynchInventory growth < Revenue growth

  EPS Growth Direction$1.13 (2019) -> $0.53 (2025)

  ✗DremanPositive over recent years

  EPS CAGR-11.9% CAGR over 6 years

  ✗Dreman> 5% annualized

  Positive Net Income Frequency5/7 years positive

  ✗MarksPositive net income in >= 7 of last 10 years

  3yr Median Revenue Growth12.7%

  ✓Ackman>= 5%

  Positive EPS Growth Frequency4/5 years with positive EPS growth

  ✓AckmanPositive EPS growth in >= 3 of last 5 years

  5-Year EPS CAGR3.3% CAGR over 5 years

  ✓Templeton> 0% (5-year EPS CAGR)

  Revenue growth vs. gross and operating margin trendgross margin 8.7% -> 11.6%, operating margin 0.7% -> 4.7%

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  5-year Revenue CAGR10.0%

  ✓SleepCAGR > 7%

  3-5 Year Diluted EPS CAGR3.3% over 5 years

  ✗Neff7%-20% annualized
• Efficiency25% pass✓ 3✗ 8▾

  6 of 8 flag AVO's efficiency — Graham, Buffett, Greenblatt +3 more

  Current Ratio1.92

  ✗Graham>= 2.0

  ROIC (3-5 yr avg)4.1%

  ✗Buffett> 10%

  ROIC - WACC-5.9%

  ✗BuffettPositive (WACC = 10%)

  EBIT / (NWC + Net Fixed Assets)2.9%

  ✗Greenblatt> 25%

  Current Ratio Change YoY1.87 -> 1.95

  ✓PiotroskiIncreased YoY

  Revenue / Total Assets Change YoY1.27x -> 1.42x

  ✓PiotroskiImproved YoY

  Current Assets / Current Liabilities1.92

  ✓Dreman> 1.5

  Return on Invested Capital1.6%

  ✗Munger> 15%

  ROIC (high and growing)FY2023: ROIC=0.8%; FY2024: ROIC=7.9%; FY2025: ROIC=7.5%

  ✗AkreLatest 3 consecutive FYs: ROIC > 15% in each

  Reinvestment Rate x ROIC7.5% (RR=100% x ROIC=7.5%)

  ✗AkreReinvestment Rate * ROIC > 10%

  ROIC (5-year)0/5 years above 12% (latest 7.5%)

  ✗SleepROIC > 12% in a majority of years
• Cash Flow30% pass✓ 5✗ 7▾

  7 of 10 flag AVO's cash flow — Buffett, Lynch, Dreman +4 more

  Free Cash Flow Proxy$37.7M

  ✗BuffettPositive and growing

  FCF Positive and Growing$-2.3M

  ✗LynchPositive and growing

  Operating Cash Flow$88.6M

  ✓PiotroskiCFO > 0

  (CFO / Total Assets) vs ROACFO/Assets=9.01%, ROA=3.84%

  ✓PiotroskiCFO/Assets > ROA

  Price / (CFO / Shares)9.4x

  ✗Dreman< 8x

  P/E or FCF YieldP/E=22.3x, FCF Yield=3.6%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  FCF Positive4/7 years FCF positive

  ✓MarksPositive FCF in majority of recent years

  (OCF - CapEx) / Market Cap-0.3%

  ✗Ackman>= 4%

  Price / FCF per Share22.4x

  ✓Ackman<= 25

  Positive Operating Cash Flow frequency7/7 years positive

  ✓SleepPositive OCF in >= 70% of available years

  Operating Cash Flow - Capital Expenditures$-2.3M

  ✗Neff> $0 (app proxy for a strong fundamental case)

  (Operating cash flow - capex) / market capitalization-0.22%; #2569/4519 (top 56.8%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Debt & Leverage42% pass✓ 7✗ 8▾

  7 of 12 flag AVO's debt & leverage — Graham, Buffett, Lynch +4 more

  LT Debt vs Net Current AssetsLT Debt $388.9M vs NCA $192.2M

  ✗GrahamLT Debt <= Net Current Assets

  Debt/Equity & Interest CoverageD/E: 0.52, IC: 2.2x

  ✗BuffettD/E < 0.5 AND Interest Coverage > 5x

  Total Debt / Equity0.52

  ✗Lynch< 0.33

  Cash - Long-term Debt$-341.8M

  ✗LynchPositive preferred

  LT Debt / Total Assets Change11.39% -> 9.44%

  ✓PiotroskiDecreased YoY

  Current Assets / Current Liabilities1.92

  ✓Dreman> 1.5✓SchlossCurrent ratio >= 1.50x (app cutoff)

  Total Debt / Shareholders' Equity0.52

  ✓Dreman< 0.8✓Templeton< 1.0 (fixed cap; proxy for below-sector-median leverage)✓SchlossD/E < 1.00x

  Debt Levels0.52

  ✗MungerDebt/Equity < 0.5✗AkreDebt/Equity < 0.3

  Interest Coverage & Debt/EBITDAIC=2.2x, D/EBITDA=6.1x

  ✗MarksInterest Coverage > 3x; Debt/EBITDA < 4x

  Total Debt / Shareholders Equity0.52

  ✓Ackman<= 1.0

  Negative debt-to-equity (higher means less debt)-0.5241; #2514/4210 (top 59.7%)

  ✗AsnessTop 30% of eligible cross-section