KeyBanc Comments on Tyson's (TSN) Q2

KeyBanc maintained a Buy rating on Tyson (NYSE: TSN) with a price target of $46.00. Analyst Akshay S. Jagdale said he would not read too much into the company's Q2 miss.

"Earlier this morning, Tyson Foods, Inc. (TSN-NYSE) reported 2Q14 adjusted EPS of $0.60, which was $0.05 below our estimate of $0.65 and $0.03 below consensus of $0.63. EBIT missed our estimate by $18 million or $0.03/share and a higher tax rate drove the remaining $0.02/share miss relative to our estimate. At the segment level, Chicken EBIT missed our estimate by $0.07/share (including international), while Beef EBIT was better than our estimate by $0.04/share. Pork and Prepared Foods were in line," said Jagdale.

"We would not read into the 2Q EPS miss too much, given that the fiscal 2Q tends to be the Company’s weakest quarter and that management’s outlook seems more bullish than before – chicken segment margins now expected to be above normal range of 5-7% and FY14 EPS are still expected to be at least $2.78. With that being said, we expect the stock to open weak owing to the headline EPS miss and strong run-up in the stock this year," he added.

For an analyst ratings summary and ratings history on Tyson click here. For more ratings news on Tyson click here.

Shares of Tyson closed at $42.65 yesterday.

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