Morgan Stanley Reiterates Underweight Rating on Tyson Foods

In a report published Monday, Morgan Stanley reiterated its Underweight rating on Tyson Foods TSN. Morgan Stanley noted, “Tyson reported adjusted F4Q12 EPS of $0.55 relative to our $0.45 estimate and consensus of $0.44. Reported EPS of $0.51 were adjusted for a $0.04 impairment charge related to non-core assets in China. The company also announced it is raising its regular dividend by 25%, declared a $0.10 special dividend, and repurchased $50 million of stock during F4Q12. Tyson expects market conditions in F2013 to be ‘equally if not more difficult' than in F2012 as a result of rising input costs. However, management is still calling for profitability (though below the normalized range) in Beef and Chicken, normalized results in Prepared Foods, and normal to above-normalized results in Pork.” Tyson Foods closed on Friday at $16.88.