Guidance Offers Hope for Tyson (TSN) after Weak Earnings Report, Shares Pressured
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Price: $25.31 --0%
Rating Summary:
11 Buy, 4 Hold, 1 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 15 | Down: 15 | New: 29
Rating Summary:
11 Buy, 4 Hold, 1 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 15 | Down: 15 | New: 29
Trade TSN Now!
Shares of Tyson Foods (NYSE: TSN) are trading lower intraday on Monday following the release of company earnings for fiscal 3rd quarter of 2012.
At $8.31 billion, revenue was a bit light compared to estimates, and earnings of $0.50 per share missed analyst expectations by 5 cents. The company faced challenges in all four major segments, including beef, chicken, and prepared foods. In a statement, CEO Donnie Smith, pointed toward softer than expected domestic demand for protein. He sees earnings for fiscal 2012 coming in lower than we previously projected.
Smith also pointed out the increasing cost of grains caused by the drought in the U.S. However, he feels the company will ultimately pass along the rising input costs, although there could be earnings pressures in 2013.
Akshay Jagdale, an analyst at KeyBanc, described Tyson Food's quarter as follows. "Overall, although the quarter was much weaker than we had expected, the Company’s guidance for 4Q12 and FY13 is much better than feared. We were particularly impressed by the Company’s expectation for its Chicken segment to be profitable in FY13 in light of the roughly 12% increase in feed costs (we had the Company losing money in its Chicken segment over next six months). Also, TSN expects its Pork segment to be at or above its normalized range of 6-8% (we were at 6%) and its Beef segment to be profitable but perhaps below its normalized range of 2.5-4.5% (we were at 1.4%)."
Year-to-day, shares of Tyson are lower by 27 percent. Intraday, shares of Tyson took a haircut of 4.4 percent.
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At $8.31 billion, revenue was a bit light compared to estimates, and earnings of $0.50 per share missed analyst expectations by 5 cents. The company faced challenges in all four major segments, including beef, chicken, and prepared foods. In a statement, CEO Donnie Smith, pointed toward softer than expected domestic demand for protein. He sees earnings for fiscal 2012 coming in lower than we previously projected.
Smith also pointed out the increasing cost of grains caused by the drought in the U.S. However, he feels the company will ultimately pass along the rising input costs, although there could be earnings pressures in 2013.
Akshay Jagdale, an analyst at KeyBanc, described Tyson Food's quarter as follows. "Overall, although the quarter was much weaker than we had expected, the Company’s guidance for 4Q12 and FY13 is much better than feared. We were particularly impressed by the Company’s expectation for its Chicken segment to be profitable in FY13 in light of the roughly 12% increase in feed costs (we had the Company losing money in its Chicken segment over next six months). Also, TSN expects its Pork segment to be at or above its normalized range of 6-8% (we were at 6%) and its Beef segment to be profitable but perhaps below its normalized range of 2.5-4.5% (we were at 1.4%)."
Year-to-day, shares of Tyson are lower by 27 percent. Intraday, shares of Tyson took a haircut of 4.4 percent.
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