The Avocado King Just Spent $6.5 Million of His Own Money

Edward Lance Lorilla
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Trade of the Day Wake-Up Watchlist

"I've been doing this long enough to know the difference between routine insider activity and a statement. This is a statement."

Nate Bear, Lead Technical Tactician, Monument Traders Alliance

Nate Bear

Most people hear "avocado company" and move on.

That's fine. More opportunity for the rest of us.

Because while the crowd was busy watching SpaceX (SPCX) and chasing AI names last week, a company called Mission Produce (AVO) was quietly printing one of the most compelling insider buying stories I've seen all year.

And the chart is starting to talk.

A Trend That's Changing Character

AVO has been a falling knife. Down from a 52-week high near $15.50 to the $11 range. That's a 30% drop on a company that controls more of the global avocado supply chain than anyone else on the planet.

Most traders look at that chart and keep scrolling.

Here's what I see instead: a downtrend that's running out of sellers.

The stock reported a rough Q2 on June 8. Revenue down 24% year-over-year. EPS came in at a penny, badly missing estimates. The stock dropped nearly 5% on the news.

And then it stopped going down.

That's the part I care about.

After a quarter that bad, AVO found a floor and held it. For three weeks it's been grinding in a tight band between $11 and $12. Lower highs have stopped making new extremes. The character of this trend is changing.

What the Form 4s Are Screaming

I've been doing this long enough to know the difference between routine insider activity and a statement.

This is a statement.

Director Bruce C. Taylor, who’s been on Mission Produce's board since 2001, knows this business as well as anyone alive. He started buying on June 15. He purchased 300,000 shares at $11.29. Came back the next day for 13,590 more at $11.40. Then on June 17, his entity Taylor Fresh Foods stepped in for another 286,410 shares at $11.27. And on June 22 he bought 29,717 more at $11.36.

Add it up. Over $6.5 million in open-market purchases in a single week, all clustered in the $11.20–$11.40 range.

Zero sales from any insider in six months. 17 purchases.

I don't need a crystal ball. I need a chart and a Form 4. When a director who's been inside this business for 25 years spends $6.5 million of his own money in one week at a multi-year low, I lean in.

The Pattern Setting Up

AVO sold off hard into earnings on June 8, then went quiet. Tight consolidation. Narrow range. Three weeks of sideways action after a 30% decline.

 

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I always say if you have to squint to see a pattern, walk away. I'm not squinting here.

The bad news is out. The stock absorbed it without breaking lower. And now it's coiling… right at the same levels where the company's longest-tenured director has been aggressively accumulating.

There's also a bigger story underneath the chart. Mission Produce closed the acquisition of Calavo Growers on May 28, a deal management says will deliver at least $25 million in annual cost synergies within 18 months. The market sold the news. Insiders bought the dip with both hands.

That's confluence.

The Squeeze Is Loading

When a stock consolidates in a tight range after a big move, volatility compresses. Bollinger Bands contract inside the Keltner Channels. The TTM Squeeze starts stacking red dots.

That's exactly what's happening on AVO right now.

Management gave a clear signal on the Q2 call: the worst of the margin compression is behind them. Second-half adjusted EBITDA is guided at $84–$88 million, a massive step-up from the $7.1 million they posted in Q2. Peruvian avocado harvest volumes are heading to all-time highs. Calavo synergies start flowing in Q4.

The fundamentals are pointing one direction. The Form 4s are pointing the same direction. The chart is coiled and waiting.

Your Action Plan

AVO isn’t a household name. It's not a sexy ticker. Nobody's debating it on financial Twitter.

That's usually when I pay the most attention.

The $11.20–$11.40 zone is my line… it's where Taylor has been accumulating and where this base has been building.

Hold that level and the squeeze fires higher. My first target is a reclaim of $13, where the stock was trading before the Q2 selloff.

Lose $11 on meaningful volume and the thesis needs a rethink.

I'll be watching this one closely all week.

If you want to follow along in real time, join me in Daily Profits Live, where we’ve closed 34 out of 42 trades as winners this month.

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