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Tyson Foods (TSN) Rises More Than 20% in 6 Months: Here's How

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Tyson Foods, Inc. (TSN - Free Report) appears to be in good shape, courtesy of its resilience and adaptability to changing market dynamics. The company has been experiencing robust growth from its diverse protein portfolio, including chicken, pork and beef.

Investing in brand building and innovation remains a priority for Tyson Foods. Furthermore, strong customer partnerships to meet evolving consumer preferences and build long-term brand loyalty are a few strategic initiatives undertaken by the company.

Tyson Foods has been performing well in the stock market, demonstrated by a 23.2% increase over the past six months, outpacing the industry’s growth of 13.5%.

The Zacks Consensus Estimate for TSN’s current financial year’s earnings suggests growth of 75.37% from the year-ago period’s reported number. The factor attributable to this growth is its diverse protein portfolio and operational efficacies stemming from its strategic plans laid out last year.

Strategies Unveiled

This Zacks Rank #3 (Hold) company’s growth strategy revolves around three main pillars, which underscore the company’s commitment to its core business of providing protein products to consumers worldwide. It prioritizes merchandising and advertising efforts to strengthen its brand presence. While Tyson Foods is satisfied with its brand strength, it also recognizes the importance of building innovations to broaden the appeal and market opportunities for its products.

It also appears that the company is experiencing positive outcomes from operational enhancements while making incremental improvements in yield and live operations. These efforts contribute toward increased productivity and efficiency. Additionally, ongoing productivity initiatives based on procurement, logistics and digitalization further strengthen the fundamentals of the company.

With respect to the Prepared Foods segment, there has been notable growth in food service volumes with the commitment to expand this sector through customer diversification and margin accretive channels. Sales in the segment grew to $2,543 million in the first quarter of fiscal 2024 from $2,538 million reported in the year-ago quarter. Prepared Foods’ sales volumes inched up 2.5%.

Within the food service business, Tyson Foods has been focused on six categories, including breakfast sausage, value-added chicken, dinner sausage, pepperoni pizza toppings, bacon and Philly Steak. Management expects robust volumes in the rest of the year for the Prepared Foods segment due to continued food service momentum and gains from capacity expansion.

Final Thoughts

The above-mentioned upsides, together with efforts to expand capacity, are likely to continue working well for Tyson Foods and help it battle the expected challenges in the Beef segment due to limited cattle supply. For the Beef segment, the USDA projects domestic protein production for beef to decline 2% year over year in fiscal 2024.

That said, for Pork, the USDA projects domestic production to jump 2% from fiscal 2023. For Chicken, it projects domestic protein production to remain flat year over year. Management anticipates improved adjusted results from the company’s foreign operations during fiscal 2024.

3 Picks You Can’t Miss

Here, we have highlighted three better-ranked stocks, namely, The Chefs' Warehouse, Inc. (CHEF - Free Report) , Colgate-Palmolive Company (CL - Free Report) and Church & Dwight Co., Inc. (CHD - Free Report) .

The Chefs' Warehouse, which distributes specialty food and center-of-the-plate products, holds a Zacks Rank #2 (Buy). CHEF delivered an earnings surprise of 3.2% in the trailing four quarters, on average. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Chefs' Warehouse’s current fiscal-year sales suggests growth of around 8.7% from the year-ago reported numbers.

Colgate-Palmolive Company, a general manufacturer and retailer of consumer products, currently carries a Zacks Rank #2. CL has a trailing four-quarter earnings surprise of 4.2%, on average.

The Zacks Consensus Estimate for Colgate’s current fiscal-year earnings suggests growth of 8.1% from the year-ago reported numbers.

Church & Dwight Co. develops, manufactures and markets a broad range of household, personal care and specialty products. The company currently carries a Zacks Rank #2. CHD has a trailing four-quarter earnings surprise of 9.7%, on average.

The Zacks Consensus Estimate for Church & Dwight’s current fiscal-year sales and earnings suggests growth of 4.4% and 8.5%, respectively, from the year-ago reported numbers.

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