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Tyson Foods (TSN) Q3 Earnings & Sales Top Estimates, Up Y/Y

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Tyson Foods, Inc. (TSN - Free Report) posted robust third-quarter fiscal 2024 results, with the top and the bottom line increasing year over year. Quarterly earnings and sales beat their respective Zacks Consensus Estimates. Management raised the lower end of its adjusted operating income guidance range for the fiscal 2024.

TSN sustained its positive momentum while focusing on advancing its key fundamentals. The strategies in place yielded tangible results in the fiscal third quarter, achieving the highest adjusted operating income in the past seven quarters. The company will focus on driving efficiencies, enhancing its portfolio, winning with customers and consumers and maintaining disciplined capital deployment.

Tyson Foods, Inc. Price, Consensus and EPS Surprise

 

Tyson Foods, Inc. Price, Consensus and EPS Surprise

Tyson Foods, Inc. price-consensus-eps-surprise-chart | Tyson Foods, Inc. Quote

 

Quarter in Detail

Tyson Foods posted adjusted earnings of 87 cents per share, which beat the Zacks Consensus Estimate of 61 cents. The bottom line increased considerably from the year-ago quarter’s reported figure of 15 cents.

Total sales were $13,353 million, inched up 1.6% from the year-ago quarter figure. The top line surpassed the Zacks Consensus Estimate of $13,165.8 million. Average price changes had a 0.6% positive impact on the top line, while total volumes grew 1.1% year over year.

The gross profit in the quarter was $878 million, up from the $677 million reported in the year-ago period. Tyson Foods’ adjusted operating income soared considerably to $491 million from the $179 million reported in the year-ago period. The adjusted operating margin expanded to 3.7% from 1.4% reported in the year-ago quarter.

Segmental Details

Beef: Sales in the segment increased to $5,241 million from $4,956 million reported in the year-ago quarter. Volumes rose 4.4% and the average price inched up 1.4% in the segment.

Pork: Sales in the segment advanced to $1,462 million from $1,324 million reported in the year-ago quarter. Volumes rose 1.2% and the average price rose 12.6%.

Chicken: Sales in the segment declined to $4,076 million from $4,212 million reported in the year-ago quarter. Sales volumes inched down 0.4% and the average price declined 3.7%.

Prepared Foods: Sales in the segment increased to $2,432 million from $2,383 million reported in the year-ago quarter. Prepared Foods’ sales volume went up 2% and the average price inched up 0.1%.

International/Other: Sales in the segment were $582 million, down from $633 million reported in the year-ago quarter. Volumes jumped 6.5% and the average sales price fell 14.6%.

Other Financial Updates

The company exited the quarter with cash and cash equivalents of $2,569 million, long-term debt of $9,701 million and total shareholders’ equity (including non-controlling interests) of $18,202 million. For the nine months ended Jun 29, 2024, cash provided by operating activities amounted to $1,973 million.

Liquidity was about $4.8 billion as of Jun 29, 2024. Management expects liquidity to stay above the company’s minimum target of $1 billion in the fiscal 2024. Tyson Foods projects capital expenditure to be nearly $1.2-$1.3 billion for the fiscal 2024. These include spending related to capacity expansion, automation, and product innovation.

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Guidance

For the fiscal 2024, the United States Department of Agriculture (USDA) suggests domestic protein production (beef, pork, chicken and turkey) to increase slightly from fiscal 2023 levels.

For the Beef segment, the USDA projects domestic protein production for beef to decline nearly 2% year over year in the fiscal 2024. For Pork, the USDA projects domestic production to jump nearly 3% from the fiscal 2023. For Chicken, USDA expects projects domestic protein production to be flat year over year. Management anticipates improved adjusted results from the company’s foreign operations during the fiscal 2024.

Total company sales are projected to be relatively flat in the fiscal 2024 versus fiscal 2023 levels. Adjusted operating income is envisioned in the $1.6-$1.8 billion band in the fiscal 2024 compared with $1.4-$1.8 billion projected earlier.

Segment-wise, management expects a fiscal 2024 adjusted operating loss of $400-$300 million for the Beef segment. For the Pork, Chicken and Prepared Foods segments, Tyson Foods envisions fiscal 2024 adjusted operating income of $100-$200 million, $850-$950 million and $850-$950 million, respectively.

This Zacks Rank #3 (Hold) stock has gained 4.7% in the past three months compared with the industry’s 1.8% growth.

Some Better-Ranked Staple Bets

Treehouse Foods (THS - Free Report) is a manufacturer of packaged foods and beverages. The company currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Treehouse Foods’ current financial-year sales and earnings indicates a decline of 1.6% and 8.5%, respectively, from the prior-year reported level. THS has a negative trailing four-quarter average earnings surprise of 4.5%.

Philip Morris (PM - Free Report) , a tobacco company, has a trailing four-quarter earnings surprise of 1.8%, on average. PM currently carries a Zacks Rank #2.

The Zacks Consensus Estimate for Philip Morris’ current financial-year sales and earnings indicates growth of 5.8% and 6.3%, respectively, from prior-year reported levels.

Colgate-Palmolive (CL - Free Report) , which manufactures and sells consumer products, currently carries a Zacks Rank #2. CL delivered an earnings surprise of 4.8% in the trailing four quarters, on average.

The Zacks Consensus Estimate for Colgate-Palmolive’s current fiscal-year sales and earnings suggests growth of 3.8% and nearly 10.5%, respectively, from the year-ago reported numbers.

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