Morgan Joseph maintains a 'Buy' on Tyson (TSN); Tyson Hits a Bump in the Road, but Grilling Season Will Soon Be Here

Morgan Joseph maintains a 'Buy' on Tyson (NYSE: TSN), PT $23.

Morgan analyst says, "Beef Disappoints Relative to Our Model. Operating profit for beef was $94mm, versus our $129mm estimate. F2Q11 ended with beef prices at their peak, resulting in a $30mm mark-to-market loss on derivative contracts shorting beef. Management believes that beef operating margins will improve in the second half of FY2011, compared to F2Q11."

"Pork Shows Biggest Upside Relative to Our Estimates. Strong volume and pricing resulted in $146mm of operating income, versus our forecast of only $128mm. An 18% increase in pricing and a 7% improvement in volume led to the upside surprise."

"Raising F3Q11 EPS Estimate; Maintaining FY11 and FY12. Our F3Q11 estimate gets a modest bump to $0.45, from $0.44, while our FY11 and FY12 EPS projections remain at $2.05 and $2.30, respectively."

For more ratings news on Tyson click here and for the rating history of Tyson click here.

Shares of Tyson closed at $17.75 yesterday.

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