The surge in egg prices is expected to decrease soon, making it a good opportunity to consider investing in the companies that produce them.

In recent weeks, wholesale egg prices have dropped significantly, from over $8 to about $4 per dozen, according to the latest USDA report. This decrease, which saw prices fall by 39% in just one week, is a result of consumers buying fewer eggs in response to high prices. While wholesale prices have fallen, retail prices are expected to follow suit gradually.

Although the egg inventory has increased by 1.7%, it will take time for producers to rebuild their flocks and restore production levels, as noted by Texas A&M University professor David Anderson. The USDA is set to disclose February's egg production data, a month heavily impacted by the bird flu outbreak that caused a 4% drop in January's production.

Despite the challenges of the bird flu outbreak, commercial egg producers like Cal-Maine Foods and Vital Farms have seen their stock prices rise significantly. Cal-Maine reported a substantial revenue increase in early January, with its stock price showing a 45% increase, while Vital Farms recorded a 32% increase over the last year.

Analysts view these companies favorably, with David Trainer from New Constructs identifying Cal-Maine Foods as an attractive stock and predicting strong performance in the future. Stephens analyst Pooran Sharma estimates Cal-Maine's market share at 20% of the US shell egg market, while Telsey Advisory's Sarang Vora has an optimistic outlook on Vital Farms, citing strong demand trends and a robust long-term growth potential. In the most recent quarter, Vital Farms reported a 22.2% revenue increase and a 46.8% rise in net income.