World's 2nd largest processor of meat Tyson Foods posts strong Q1 Results

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Tyson Foods Q1 results

Revenue higher than estimates - The total sales reported by the company were up 0.3% to $12.93 billion compared to $10.46 billion in the same quarter last year. The revenue is higher than street estimates of $12.18 billion.

Operating income - Tyson Foods, one of the world’s largest food companies, reported an operating income of $1,455 million. It is 106% higher compared to the year-ago period. Adjusted operating income stood at $1,432 million, up 40% from the prior year.

Margins - The operating margins reported by the company was 11.3%, while the adjusted operating margin was 11.1%

Other updates - The liquidity reported by the company as of 1 January 2022 was $5.2 billion. The company has repurchased 4.2 million shares for $348 million.

Sales from different segment

  • Pork sales - was up 0.2% to $1.63 billion, as strong global demand was offset by the impacts associated with a challenging labor environment.
  • Chicken sales - increased 3.6% to $3.89 billion, primarily due to increased live production and a strong demand environment.
  • Prepared Foods - sales volume decreased 2.6% to $2.33 billion, due to the divestiture of our pet treats business in the fourth quarter of fiscal 2021 as well as lower production throughput primarily associated with a challenging labor and supply environment.

2022 Outlook

Tyson Food is targeting $1 billion in productivity savings by the end of fiscal 2024 and $300 million to $400 million in fiscal 2022, relative to a fiscal 2021 cost baseline. They expect sales to be at the upper end of $49 billion to $51 billion in fiscal 2022. Tyson Food expects capital expenditures of approximately $2 billion and net interest expense to approximate $360 million for fiscal 2022.

Target Price - The 11 analysts offering 12-month price forecasts for Tyson Foods Inc have a median target of $95, with a high estimate of $113 and a low estimate of $88. 

The stock closed 12.25% higher on Monday at $99.09.