In this file:
· Tyson says pork exports to China soared nearly 600% in first quarter after swine fever outbreak
· Tyson Foods Is a 'Must Buy' Here, Jim Cramer Says
· Analysts cite potential coronavirus impact to Tyson Foods, Walmart
Tyson says pork exports to China soared nearly 600% in first quarter after swine fever outbreak
Tyson has also announced a restructuring that will lead to 500 job cuts
By Tonya Garcia, MarketWatch
Feb 12, 2020
Tyson Foods Inc. says it’s just starting to see the benefits of the African swine fever outbreak in China, which includes a 600% year-over-year increase in pork orders to China in the fiscal first quarter.
The meat producer says it is moving toward a ractopamine-free hog supply, which should open additional markets for its pork products. Ractopamine is a feed additive that is banned in many countries.
“In fact, global demand for all proteins is increasing as African swine fever continues to reduce pork supplies in Asia,” said Noel White, chief executive officer, on the company’s earnings call last week.
Tyson reported fiscal first-quarter sales that missed expectations, though earnings per share beat the FactSet consensus.
Tyson also anticipates double the demand for chicken in China.
CFRA’s Arun Sundaram said a number of factors, including African swine fever, will create a tailwind for Tyson.
“Overall, we think conditions will drastically improve in the back half of the year; exports should ramp up as Tyson supplies China and backfills other countries, beef margins should remain high due to less U.S. imports of Australian beef (caused by the bush fires), China could reduce tariffs, and Tyson plans to launch more alternative protein products,” the note said.
CFRA rates Tyson stock a strong buy with a $105 12-month target.
Tyson’s plant-based Beyond Meat Inc. competitor Raised & Rooted is now available in 7,000 stores. White said the company is planning more product launches later in the year, with nutrition and affordable pricing a major consideration for new items.
“Ultimately, we conclude that while African swine fever still will be a substantial catalyst, some of the upside is already priced in,” said JPMorgan in a note. Analysts there rate Tyson shares...
Tyson Foods Is a 'Must Buy' Here, Jim Cramer Says
Tony Owusu, TheStreet
Feb 12, 202
Tyson Foods (TSN) - Get Report has had a rough start to the year, dropping more than 11% year to date, but Jim Cramer and the team at Action Alerts PLUS believe the meatpacker has a bright upside thanks to the poultry environment in China.
There have been recent reports that China’s poultry supplies are at risk because the country doesn't have enough soybean meal to feed the chickens, leaving poultry farms in jeopardy. Investors are nothing if not opportunists.
"So I think it's just completely the right play on the environment,” said Action Alerts PLUS senior researcher Jeff Marks on the club's exclusive monthly members-only call. “There's always going to be pressures from Beyond Meat (BYND) - Get Report and maybe there's a transition there. But I think America still loves chicken.”
Jim Cramer agreed with Marks' assessment of the chicken industry...
more, including links, video [2:33 min.]
Analysts cite potential coronavirus impact to Tyson Foods, Walmart
by Kim Souza, Talk Business & Politics (AR)
Feb 12, 2020
China is a long way from Northwest Arkansas but its impact to the region’s two largest companies is important. Tyson Foods and Walmart each have substantial operations in China and throughout Asia and those areas are most impacted by the latest coronavirus outbreak.
Reports from China indicate the food and retail sectors are among those most impacted in the early days of the outbreak. The foodservice sector in China was one of the hardest hit by the coronavirus that analysts say likely cost the economy billions during the country’s Lunar New Year celebrations last week. Analysts with Rabobank said the impact could range between $35 billion and $80 billion.
The food and agriculture sectors have been hit hard as many cities remain under lockdown, according to Rabobank analyst Ping Chew. Chew noted the impact could be more serious and longer-lasting if the virus isn’t contained within the first quarter. The losses from foodservice alone could total $8.8 billion to $13.6 billion.
Analysts said frozen foods, ready-to-eat meals and bottled water are also poised to benefit because of panic buying in impacted regions. If the virus is not under control until late spring, analysts said the impacts on animal proteins could persist.
Tyson Foods operates retail and foodservice divisions in China. The Springdale-based meat giant has not yet said if the virus will have a material impact on earnings for the second quarter which ends March 31, or beyond. The company did forecast seasonally weaker profits for the quarter but did not provide any color on the pending impact of the coronavirus.
“We’re closely monitoring news of coronavirus. We are actively assessing what this outbreak may mean for our global business and preparing for the possibility of any impact. In China, we have been working with the government and we have successfully re-started some of our operations,” Worth Sparkman, corporate spokesman for Tyson Foods, told Talk Business & Politics.
Bentonville-based Walmart also has substantial operations in China with more than 400 retail stores and clubs, distribution centers and supply chain operations. While the retail giant could benefit from the increased sales of water, frozen and ready-to-eat foods should the uptick in demand last, the company’s overall supply chain could be hit hard as the company imports substantial products from China and other Asian countries that source raw materials in China.
Ike Boruchow, an analyst with Wells Fargo Securities, recently lowered price estimates for retailers with meaningful exposure to China. He said the overall supply chain has not likely factored in the financial impact it will feel because of the slowing in China. About 40% of all shipments that entered the United States last month came from China, according to Freightwaves, and a recent report from the trade publication on the coronavirus showed 7% of vessel sailings from China to the West Coast were canceled as a result of the virus...