Tyson Hits 52-Week High on Strong Outlook - Analyst Blog

Shares of Tyson Foods, Inc. TSN reached a new 52-week high of $41.91 on Mar 17, 2014, following its optimistic outlook projected at a recently held investor conference.     

The closing price of this meat processing company on Monday was $41.67, yielding a year-to-date return of 71.62%.

Growth Drivers

Leading meat processor Tyson provided an optimistic outlook for the upcoming years with solid earnings growth backed by decent top-line gains.

For the long term, Tyson plans to grow the top line by 3% to 4% annually, backed by strong focus on its value added chicken products, prepared foods and beef and pork segments. It also plans to maintain an earnings growth of 10% a year and grow its international business by 12% to 16% by fiscal 2015.

Springdale, AR-based food processor, Tyson made a solid start to fiscal 2014 with a decent top-line increase in first-quarter 2014. On Jan 31 2014, Tyson reported adjusted earnings of 72 cents per share beat both the Zacks Consensus Estimate and prior-year results on the back of strong sales in all the business segments.

The company also gave a positive outlook for the ongoing year. For fiscal 2014, Tyson expects earnings per share to be up 23% compared to the previous year. Domestic chicken production is expected to go up, although fed cattle and hog supplies are expected to remain short even in the upcoming year. However, the company expects the prepared foods segment to benefit from operational improvements and positive pricing.

Tyson sports a Zacks Rank #1 (Strong Buy). Other players in the retail sector worth considering include Hillshire Brands Co. HSH, Diamond Foods Inc. DMND and Unilever plc UL. All these stocks carry a Zacks Rank #2 (Buy).