Meaty Challenges Ahead! Tyson Food's Beef & Pork Margins May Shrink For Years: Analyst
Portfolio Pulse from Nabaparna Bhattacharya
BMO Capital Markets analyst Andrew Strelzik downgraded Tyson Foods, Inc. (TSN) with a lower price target of $46, citing challenges in Beef & Pork margins that may persist through FY25. Tyson's Q4 EPS beat estimates, but the medium-term earnings outlook remains constrained without clear catalysts for recovery. Beef margins are expected to limit EPS, while Chicken profit guidance appears conservative. Pork faces challenges due to lack of vertical integration, and Prepared Foods could be impacted by consumer spending and competitive pressures. TSN shares rose 4.10% to $47.49.
November 14, 2023 | 8:19 pm
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NEGATIVE IMPACT
Tyson Foods downgraded by BMO Capital Markets with a lower price target of $46 due to expected margin challenges in Beef & Pork segments through FY25, despite a Q4 EPS beat.
The downgrade and reduced price target by a prominent analyst based on anticipated margin pressures in key segments of Tyson Foods' business are likely to negatively impact investor sentiment and the stock price in the short term. The Q4 EPS beat may provide some support, but the medium-term outlook without clear earnings recovery catalysts and specific challenges in Beef, Pork, and Prepared Foods segments could weigh on the stock.
CONFIDENCE 90
IMPORTANCE 85
RELEVANCE 100