Tyson Foods, Inc. TSN began fiscal 2025 on a robust note, with the first-quarter top and bottom lines improving year over year and cruising past the Zacks Consensus Estimate.
This marked the Zacks Rank #1 (Strong Buy) company’s strongest quarterly results in more than two years, backed by better execution across its operations, particularly in the chicken segment. With consumer demand for protein remaining strong, TSN’s diversified multi-channel, multi-protein portfolio places it well to meet this need while solidifying its status as a leading global food company.
TSN’s Quarterly Performance: Key Insights
Tyson Foods posted adjusted earnings of $1.14 per share, which crushed the Zacks Consensus Estimate of 79 cents. The bottom line increased around 65% from the year-ago quarter’s reported figure of 69 cents.
Tyson Foods, Inc. Price, Consensus and EPS Surprise
Tyson Foods, Inc. price-consensus-eps-surprise-chart | Tyson Foods, Inc. Quote
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Total sales of $13,623 million increased 2.3% from the year-ago quarter figure. The top line surpassed the Zacks Consensus Estimate of $13,476 million. Average price changes had a 0.7% positive impact on the top line, while total volumes grew 1.6% year over year.
The gross profit in the quarter was $1,095 million, up from the $823 million reported in the year-ago period.
Tyson Foods’ adjusted operating income soared 60% to $659 million from the $411 million reported in the year-ago period. The adjusted operating margin expanded to 4.8% from 3.1% recorded in the year-ago quarter.
Decoding TSN’s Segmental Details
Beef: Sales in the segment increased to $5,335 million from $5,023 million reported in the year-ago quarter. Volumes rose 5.6%, and the average price jumped 0.6% in the segment.
Pork: Sales in the segment rose to $1,617 million from $1,517 million reported in the year-ago quarter. Volumes fell 0.4%, but the average price increased 7%.
Chicken: Sales in the segment improved to $4,065 million from $4,033 million reported in the year-ago quarter. Sales volumes grew 1.5%, while the average price was down 0.7%.
Prepared Foods: Sales in the segment came in at $2,473 million, down from $2,543 million reported in the year-ago quarter. Volumes dipped 3.2%, and the average price rose 0.4%.
International/Other: Sales in the segment were $584 million compared with $582 million reported in the year-ago quarter. Volumes jumped 4.3%, whereas the average sales price fell 4%.
Tyson Foods’ Other Financial Updates
The company exited the quarter with cash and cash equivalents of $2,292 million, long-term debt of $9,711 million and total shareholders’ equity (including non-controlling interests) of $18,627 million. For the three months ended Dec. 28, 2024, cash provided by operating activities amounted to $1,031 million.
Liquidity was nearly $4.5 billion as of Dec. 28. Management expects liquidity to stay above the company’s minimum target of $1 billion in fiscal 2025. Tyson Foods projects capital expenditure to be nearly $1-$1.2 billion for the fiscal. Free cash flow in fiscal 2025 is expected to come in the range of $1-1.6 billion.
What to Expect From TSN in FY25?
For fiscal 2025, the United States Department of Agriculture (“USDA”) suggests domestic protein production (beef, pork, chicken and turkey) to increase around 1% from the fiscal 2024 level.
For the Beef segment, the USDA projects domestic protein production for beef to decline nearly 1% year over year in fiscal 2025. For Pork, the USDA projects domestic production to jump nearly 2%. For Chicken, USDA expects projects domestic protein production to grow about 2% year over year. Management anticipates improved adjusted results from the company’s foreign operations during fiscal 2025.
Total company revenue growth is anticipated to come in the range of flat to increase 1% in fiscal 2025 versus fiscal 2024 levels. Adjusted operating income is envisioned in the $1.9-$2.3 billion band.
Segment-wise, management expects a fiscal 2025 adjusted operating loss in the band of $0.4-$0.2 billion for the Beef segment. For the Pork, Chicken and Prepared Foods segments, Tyson Foods envisions fiscal 2025 adjusted operating income of $0.1-$0.2 billion, $1-$1.3 billion and $0.9-$1.1 billion, respectively.
Shares of TSN have dipped 3.1% in the past three months compared with the industry’s decline of 7.6%.
Other Solid Staple Bets
United Natural Foods, Inc. UNFI currently sports a Zacks Rank of 1. UNFI delivered a trailing four-quarter earnings surprise of 553.1%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for United Natural’s current financial-year sales and earnings indicates growth of 0.3% and 442.9%, respectively, from the year-ago period’s reported figure.
TreeHouse Foods THS, a private brands snacks and beverages company, presently holds a Zacks Rank #2 (Buy). THS delivered a trailing four-quarter earnings surprise of 20.4%, on average.
The Zacks Consensus Estimate for TreeHouse Foods’ full-year 2025 sales and earnings implies growth of 1.2% and 24.9%, respectively, from the year-ago period’s reported figure.
US Foods Holding USFD, which engages in marketing, sale, and distribution of fresh, frozen, and dry food and non-food products, currently carries a Zacks Rank #2. USFD delivered a positive earnings surprise of 3.7% in the last reported quarter.
The consensus estimate for US Foods’ full-year sales and earnings calls for growth of 5.2% and 22.1%, respectively, from the prior-year reported levels.
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