On January 12, 2011 it was announced that the country's surplus corn has dropped to its lowest level in four years. Concerns about the country's corn production volume has driven an 82% increase in its price since February 2010. The latest news suggests that corn prices will continue to rise in the face of shrinking supply, raising concerns that increased corn costs may eat into Tyson's profit margin. In the two weeks following the announcement, Tyson's stock fell 1.16%; however the effects of increased corn prices may not be seen until earnings are reported later in the year.
After settling a lawsuit where Tyson was accused of falsely claiming its chickens were raised without antibiotics, a number of bank analysts upgraded the company's stock. Analysts at BMO Capital Markets, Credit Suisse, and BB&T upgraded the company's stock from neutral/hold to outperform/buy following the settlement and sustained rising chicken prices.
A Deutsche Bank analysts raised her FY2009 EPS estimate 4 cents to $1.10, citing improved conditions across Tyson's product lines. Additionally, she wrote that higher pricing in the pork and beef segments will allow Tyson to pad its balance sheet and cover weaknesses in its chicken segment.
Tyson was downgraded from "buy" to "hold" at both Deutsche bank and BMO Capital Markets, citing fears that chicken prices may not rise at the same pace as they have in the first half of 2009. Additionally, the analysts wrote that a potential declien in demand for fast food would further moderate earnings growth for the company.
Investors dropped Tyson as swine flu spread. Although swine flu is not transmissible through pork consumption, investors feared that consumers would avoid the meat altogether.
A JP Morgan analyst upgraded Tyson to "buy," writing that the securement of a new credit line will eliminate any concern about the company's current level of debt. Additionally, the company will benefit from price increases in its chicken segment.
A JP Morgan analyst upgraded Tyson to "buy," writing that the securement of a new line of credit has removed any concerns about the company's current level of debt. Additionally, the company will also benefit from higher prices in its chicken segment.
Tyson's long term debt was downgraded one notch deeper into junk territory by ratings agency Fitch. The company cited weakness in the company's chicken segment in its dowgrade, while also recognizing that the Tyson's credit situation will likely improve in the coming months.
Although the company's chicken segment posted a loss in 1Q09, company executives announced a production cut and lower feed prices as evidence that the segment will soon turn around.
Tyson pled guilty and agreed to pay the maximum criminal fine of $500,000. The company will also address and resolve safety issues at its processing plants.[1]
Tyson put up all operating segments as collateral in exchange for more generous credit terms with its lenders.
Tyson, along with the rest of the market, plummets on investor pessimism in the wake of the 2008 Financial Crisis.
Tyson returns to profitability in Q4 but still falls a penny short of analyst estimates. The company also reduced FY 2008 guidance, blaming higher raw commodity costs such as grain.
Tyson Foods decreased its 2007 earnings outlook due to higher cost of ‘higher-than-expected’ live cattle and decline in beef revenue as the beef trade with South Korea declined. Further, the sales for chicken reduced after it had increased its price.
Shares of top U.S. meat producer Tyson Foods Inc. jumped more than 5 percent to their highest level since 1998 amid rumors in the options markets that the company could be a takeover target.
Tyson Fresh Meats Inc. recalled more than 40,000 pounds of ground beef shipped to Wal-Mart stores in 12 states after samples tested at a Sherman, Texas, plant showed signs of E. coli contamination. No illnesses had been reported.
Oil company ConocoPhillips and meat producer Tyson Foods Inc. plan to work together to produce biodiesel from animal fat. ConocoPhillips, the third-largest U.S. oil company, said it plans to spend about $100 million over a 3 year to 5 year period to prepare several refineries to process the fuel. Tyson said production is expected to start late in 2007 and ramp up through spring 2009. At full production, Tyson expects annual earnings of 4 cents to 16 cents a share from the project.
