TSN: Get Your Serving of Tyson Foods’ Steady Trend

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Tyson Foods, Inc. (TSN) has been on a roll this year; TSN released a stellar fourth-quarter earnings report yesterday.

hillshire brandsIs now a good time for investors to sink their teeth into Tyson Foods?

Tyson Foods – Company Profile

With over $34 billion in annual sales and a workforce of over 115,000, Tyson Foods is officially the largest meat producer in the world. While as consumers many of us are familiar with Tyson’s offerings at the supermarket, Tyson also supplies meat to national fast food and full service restaurant chains. One of Tyson Foods’ largest customers is Yum! Brands, Inc. (YUM).

Since Tyson Foods ends up with large amounts of animal fats, it also runs a renewable energy business that renders this leftover material into bio-fuels. Yield-seekers may want to know that TSN just increased its quarterly dividend to 9 cents per share. TSN shareholders of record on Dec. 1 will be paid on Dec. 15.

Tyson Foods – Earnings Rundown

For the fourth quarter, Tyson Foods posted net income of $137 million, or 35 cents per share. Excluding special items, TSN earnings were 87 cents per share, which topped the 76 cents per share consensus earnings estimate by 14.5%. Compared with the year ago quarter, total sales jumped 14% to $10.11 billion, which missed the $10.16 billion consensus sales estimate by a hair.

According to Tyson Foods management, the integration of Hillshire Brands is going according to schedule, and Tyson Foods expects the merger to generate $225 million in cost savings for the current fiscal year. Tyson Foods estimates for full year 2015 adjusted earnings will range from $3.30 to $3.40 per share, while analysts estimate $3.33. All-in-all, TSN had a great earnings report.

Tyson Foods – Current Ratings

Tyson Foods stock has held steady at a buy rating for the past 12 months running. TSN stock currently earns an “A” for its Quantitative Grade, indicating strong institutional buying pressure.

TSN also earns a “C” for its Fundamental Grade. TSN enjoys strong cash flow (A), operating margin growth (B), return on equity (B) and analyst earning revisions (B). However, Tyson Foods could stand to improve sales growth (C), earnings momentum (D), earnings surprises (D) and earnings growth (C).

As of this posting, Nov. 18, I consider TSN a “B-rated buy.”

Louis Navellier is a renowned growth investor. He is the editor of five investing newsletters: Blue Chip GrowthEmerging GrowthUltimate GrowthFamily Trust and Platinum Growth. His most popular service, Blue Chip Growth, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters.


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