Dole (DOLE)

Fresh produce company Dole (NYSE:DOLE) reported Q4 CY2025 results beating Wall Street’s revenue expectations, with sales up 9.2% year on year to $2.37 billion. Its non-GAAP profit of $0.14 per share was in line with analysts’ consensus estimates.

Company Overview

Known for its delicious pineapples and Hawaiian roots, Dole (NYSE:DOLE) is a global agricultural company specializing in fresh fruits and vegetables.

The perishable food industry is diverse, encompassing large-scale producers and distributors to specialty and artisanal brands. These companies sell produce, dairy products, meats, and baked goods and have become integral to serving modern American consumers who prioritize freshness, quality, and nutritional value. Investing in perishable food stocks presents both opportunities and challenges. While the perishable nature of products can introduce risks related to supply chain management and shelf life, it also creates a constant demand driven by the necessity for fresh food. Companies that can efficiently manage inventory, distribution, and quality control are well-positioned to thrive in this competitive market. Navigating the perishable food industry requires adherence to strict food safety standards, regulations, and labeling requirements.

Competitors in the fresh produce category include Calavo Growers (NASDAQ:CVGW), Fresh Del Monte (NYSE:FDP), and Mission Produce (NASDAQ:AVO) along with private companies Chiquita Brands International and Sunkist Growers.

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years.

With $9.17 billion in revenue over the past 12 months, Dole is one of the larger consumer staples companies and benefits from a well-known brand that influences purchasing decisions. However, its scale is a double-edged sword because there are only a finite number of major retail partners, placing a ceiling on its growth. For Dole to boost its sales, it likely needs to adjust its prices, launch new offerings, or lean into foreign markets.

As you can see below, Dole’s 2% annualized revenue growth over the last three years was sluggish. This shows it failed to generate demand in any major way and is a rough starting point for our analysis.

This quarter, Dole reported year-on-year revenue growth of 9.2%, and its $2.37 billion of revenue exceeded Wall Street’s estimates by 2.3%.

Looking ahead, sell-side analysts expect revenue to grow 1.3% over the next 12 months, similar to its three-year rate. This projection is underwhelming and suggests its newer products will not catalyze better top-line performance yet.

At StockStory, we prefer high gross margin businesses because they indicate pricing power or differentiated products, giving the company a chance to generate higher operating profits.

Dole has bad unit economics for a consumer staples company, signaling it operates in a competitive market and lacks pricing power because its products can be substituted. As you can see below, it averaged a 8.1% gross margin over the last two years. That means Dole paid its suppliers a lot of money ($91.89 for every $100 in revenue) to run its business.

This quarter, Dole’s gross profit margin was 6.7%, in line with the same quarter last year. On a wider time horizon, the company’s full-year margin has remained steady over the past four quarters, suggesting its input costs (such as raw materials and manufacturing expenses) have been stable and it isn’t under pressure to lower prices.

Operating margin is a key measure of profitability. Think of it as net income - the bottom line - excluding the impact of taxes and interest on debt, which are less connected to business fundamentals.

Dole’s operating margin might fluctuated slightly over the last 12 months but has generally stayed the same, averaging 2.6% over the last two years. This profitability was paltry for a consumer staples business and caused by its suboptimal cost structureand low gross margin.

Analyzing the trend in its profitability, Dole’s operating margin might fluctuated slightly but has generally stayed the same over the last year. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

This quarter, Dole generated an operating margin profit margin of 1.2%, in line with the same quarter last year. This indicates the company’s cost structure has recently been stable.

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Dole’s EPS grew at a decent 7.4% compounded annual growth rate over the last three years, higher than its 2% annualized revenue growth. However, we take this with a grain of salt because its operating margin didn’t improve and it didn’t repurchase its shares, meaning the delta came from reduced interest expenses or taxes.

In Q4, Dole reported adjusted EPS of $0.14, down from $0.16 in the same quarter last year. This print missed analysts’ estimates, but we care more about long-term adjusted EPS growth than short-term movements. Over the next 12 months, Wall Street expects Dole’s full-year EPS of $1.20 to grow 23.3%.

Free cash flow isn't a prominently featured metric in company financials and earnings releases, but we think it's telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king.

Dole has shown weak cash profitability over the last two years, giving the company limited opportunities to return capital to shareholders. Its free cash flow margin averaged 1%, subpar for a consumer staples business.

Taking a step back, we can see that Dole’s margin dropped by 2.1 percentage points over the last year. Almost any movement in the wrong direction is undesirable because of its already low cash conversion. If the trend continues, it could signal it’s becoming a more capital-intensive business.

Dole’s free cash flow clocked in at $67.87 million in Q4, equivalent to a 2.9% margin. The company’s cash profitability regressed as it was 3.2 percentage points lower than in the same quarter last year, but it’s still above its two-year average. We wouldn’t read too much into this quarter’s decline because investment needs can be seasonal, causing short-term swings. Long-term trends trump temporary fluctuations.

EPS and free cash flow tell us whether a company was profitable while growing its revenue. But was it capital-efficient? Enter ROIC, a metric showing how much operating profit a company generates relative to the money it has raised (debt and equity).

Dole historically did a mediocre job investing in profitable growth initiatives. Its five-year average ROIC was 7.6%, somewhat low compared to the best consumer staples companies that consistently pump out 20%+.

Dole reported $274.3 million of cash and $857.5 million of debt on its balance sheet in the most recent quarter. As investors in high-quality companies, we primarily focus on two things: 1) that a company’s debt level isn’t too high and 2) that its interest payments are not excessively burdening the business.

With $354.3 million of EBITDA over the last 12 months, we view Dole’s 1.6× net-debt-to-EBITDA ratio as safe. We also see its $30.32 million of annual interest expenses as appropriate. The company’s profits give it plenty of breathing room, allowing it to continue investing in growth initiatives.

We enjoyed seeing Dole beat analysts’ EBITDA expectations this quarter. We were also happy its revenue outperformed Wall Street’s estimates. On the other hand, its gross margin missed and its EPS was in line with Wall Street’s estimates. Overall, this was a weaker quarter. The stock remained flat at $15.91 immediately after reporting.

Updated: February 25, 2026 at 6:22 AM EST

Are you wondering whether to buy Dole or pass? We urge investors to not only consider the latest earnings results but also longer-term business quality and valuation as well.

Dole doesn’t pass our quality test. To kick things off, its revenue growth was uninspiring over the last three years, and analysts don’t see anything changing over the next 12 months. While its projected EPS for the next year implies the company’s fundamentals will improve, the downside is its gross margins make it more challenging to reach positive operating profits compared to other consumer staples businesses. On top of that, its operating margins are low compared to other consumer staples companies.

Dole’s P/E ratio based on the next 12 months is 10.8x. This valuation is reasonable, but the company’s shaky fundamentals present too much downside risk. There are more exciting stocks to buy at the moment.

Wall Street analysts have a consensus one-year price target of $17.50 on the company (compared to the current share price of $15.91).