Chiquita Brands International, Inc. looks ripe for a better year, analysts say. If only more investors were convinced that may be the case.

Shares of the big banana producer have dropped 17% so far this year, a worse performance than that of both rival Dole Food Co. (down 5.4%) and the Standard & Poor’s 500 Index (down 1.8%).

Food companies over the past year were pinched by a weak economy and widespread price declines for fruits, vegetables and other products. More recently, Chiquita was hurt by soft sales in Europe and a slide in the euro. Europe accounts for about 35% of Chiquita’s banana revenue, and a declining euro makes sales in the region worth less when converted to U.S. dollars.

When Chiquita releases financial results today, the Cincinnati-based company is expected to report a loss of about $12 million, or 28 cents a share, for the fourth quarter, according to analysts surveyed by Bloomberg LP.

Still, analysts such as Heather Jones of BB&T Capital Markets see brighter prospects for Chiquita amid prospects for higher banana prices.

There has been “much trepidation” regarding the 2010 banana outlook for Chiquita, Jones wrote in a Feb. 17 report. Jones said average banana prices are the weakest she’s seen, but “we believe core supply and demand remains largely balanced and once weather improves, prices will follow,” she said.

North American banana prices are expected to increase by “low single-digits,” on a percentage basis, from 2009 levels, Jones said in a separate report Feb. 3.

In January, average U.S. retail banana prices fell 8.2% compared with the same month in 2009, according to Labor Department data. That was the 10th consecutive month prices fell compared with the corresponding month a year earlier.

Chiquita may also reap benefits from improvements in its Fresh Express salad business.

In the third quarter, Chiquita’s salad business had an operating profit of $24 million, following a loss of $8 million in the same period a year earlier, even as the unit’s sales fell 11%, to $289 million.

“The turnaround in Fresh Express was truly the story at Chiquita during 2009,” Jones said.

Chiquita’s management believes double-digit profit margins for Fresh Express “are achievable,” Jones said. The efforts of Dole, Chiquita’s largest competitor, to “vastly improve its salad margins should provide an amenable environment to further improvement,” Jones said.

Jones earlier this month lowered her full-year 2010 earnings forecast for Chiquita to $2.15 a share from $2.40 to reflect a weaker euro and lower Europe prices. She still maintains a “buy” rating on Chiquita shares, which fell 36 cents to $14.91 near midday today.

Chiquita earned $2.32 a share in 2009, Jones estimated.

In the third quarter, Chiquita had net income of $5 million, compared with a loss of $17 million a year earlier. Sales fell 4.6% to $801 million.

Analysts say Chiquita poised for better year