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lico, Inc. (Nasdaq: ALCO), a legacy citrus grower, has decided to pivot its business model after a 73% decline in citrus production over the last decade. The company's economic viability eroded due to the spread of citrus greening disease and recurring hurricanes, which impacted production efficiency despite investments in advanced treatment techniques. As a result, ALCO generated only 4% of its revenue from non-citrus operations last year.

    However, the company has identified an alternative source of value: its vast swaths of prime Florida real estate. ALCO owns 51,300 acres across 8 counties that can be used for various purposes beyond orange groves. The company is now focused on a three-pronged business strategy: near-term development properties, longer-term developmental properties, and ongoing agricultural leasing.

    For 2026, ALCO has secured agreements to lease out approximately 5,250 acres to third-party citrus growers, generating recurring contract-based income without the high fixed costs of citrus farming. The company also plans to convert farm acreage into value through entitlement, planning, and controlled sales, with potential for significant shareholder value creation.

    ALCO's real estate portfolio could generate up to $380 million in present value over the next five years, driven by land appreciation post-entitlement. The company has already reduced personnel costs dramatically, slashing its workforce nearly 90% from 200 to 25 employees. ALCO is also improving its balance sheet, with net debt decreasing and cash on hand increasing.

    For investors, ALCO offers a stable source of recurring revenues from agricultural leases and land-use partnerships, combined with the upside potential of real estate development. The company's announced $50 million share repurchase authorization underscores management's confidence in the new business strategy and commitment to returning cash to shareholders.