In this file:
· Tyson Foods: My First Strong Buy Recommendation
· Tyson Foods makes processing shift amid coronavirus demands
· Tyson Foods joins battle against COVID-19 by expanding hunger relief efforts
· Sanderson Farms and Tyson Foods upgraded as coronavirus-related demand sends meat 'flying off the shelves'
· Why Tyson Is Producing More Meat For Grocery Stores Right Now
Tyson Foods: My First Strong Buy Recommendation
About: Tyson Foods, Inc. (TSN)
Chuck Walston, Seeking Alpha
Mar. 19, 2020
o New trade agreements provide Tyson with access to larger markets.
o Company initiatives should fuel growth.
o A firm financial foundation, a well-funded dividend, and a low valuation all make Tyson a stellar investment.
In the span of less than six weeks,Tyson Foods' (TSN) yield jumped from 2% to roughly 3.5%. Of course, that isn't from a dividend increase. The surge resulted from the stock plummeting. In the last month the S&P dropped 32% while Tyson shares fell 46%. Unless there is a fundamental flaw with the company, I see these developments as a positive for potential investors.
As the citizens of developing nations move into the middle class, demand for protein rich foods increases. This is occurring during a time in which a quarter of the world's domestic pigs perished due to African swine fever (ASF) in one year.
Tyson is moving to expand into foreign markets to meet the increased demand. The company also has a well-funded dividend that grew more than ten-fold in less than a decade.
The Developing Economies Crave Protein
It is a well-established fact that as countries become richer, their citizens eat more protein. More specifically, they consume more chickens, pigs and cattle. The map below testifies to that trend…
o World: 77g/person/day
o Developed countries: 103g/person/day
o Developing World: 70g/person/day
o Sub-Saharan Africa: 55g/person/day
Tyson cited research stating 98% of growth in demand for the company's products will occur outside the US over the next five years. The company also estimates that 5% of global pork production was lost due to ASF.
Pork is a food staple in China as well as in much of east Asia and the Pacific. Seventy percent of the meat consumed in China is pork, and the cost of pork in that nation has increased by 70%. Unfortunately for Chinese ham lovers, half of the pigs in that country were lost due to ASF last year alone. When one considers nearly half of the hogs on the globe once called China home, that represents a substantial blow to China's domestic protein sources.
There are those who believe ASF will remain endemic to east Asia and eastern Europe for years. It should be noted that there is no cure or inoculation for the disease. When a pig is infected, the protocol is to cull the entire herd. Despite these draconian measures, ASF is present in at least 50 countries.
Imports of pork to China have increased by 44% while beef imports rose by 50% during the first nine months of 2019. In Q1 2020, Tyson's pork exports increased 600% YoY.
Developing Economies And ASF Could Drive Growth For The Foreseeable Future ...
An Initiative That Should Drive Growth ...
The Fried Chicken Sandwich Wars Are A Secondary Source Of Growth ...
Tyson Stock Was Trending Down Before COVID -19 ...
My Perspective ...
more, including maps, links, charts
Tyson Foods makes processing shift amid coronavirus demands
by Kim Souza, Talk Business & Politics (AR)
Mar 19, 2020
Dean Banks, president of Springdale-based Tyson Foods, is getting baptized by fire in his new role. He first faced supply chain hitches as the coronavirus unfolded in China. Banks was then hit with a major uptick in retail demand as Americans raced to grocery stores to stockpile food.
Banks said Tyson Foods, who serves foodservice customers and retail stores like Walmart and Kroger, is able to shift some of its chicken, beef and pork production from foodservice to meet the surge in demand for retail food products.
“We are committed to ensuring the continuity of our business and the availability of our products to customers across the nation,” Banks said in a recent company blog.
He said as stores face empty shelves amid frantic buying patterns, Tyson Foods has been working behind the scenes to keep product flowing to its customers.
“With more than 100 food production plants in the U.S., our unique scale allows us to quickly adjust and meet the current demand at grocery and other retail stores. We’re working collaboratively with our customers to fill and ship orders as rapidly as possible. In some cases, our capability to shift processes in individual plants is allowing us to quickly pivot to producing retail items. For example, changing packaging from a foodservice product to a retail product can occur quickly because of the built-in flexibility of our operations,” Banks said.
He said U.S. food supply is more than sufficient and Tyson Foods is taking a variety of measures to meet the shifting increase in demand and to ensure a steady supply moving forward.
Tyson Foods joins battle against COVID-19 by expanding hunger relief efforts
by: Sue Necessary, KETK (TX)
Mar 19, 2020
SPRINGDALE, Arkansas (KETK) – Tyson Foods is expanding its hunger relief effort to help ensure that people affected by COVID-19 have access to food.
“Our role as America’s largest food company is critical,” the company said in a news release announcing the expansion. “We produce 1 in every 5 pounds of chicken, beef and pork in the U.S. and take our responsibility to provide protein to those in need seriously.
“In this unprecedented environment, every day, more of our friends and neighbors are depending on local food banks and community pantries to provide for their families. Tyson Foods is committed to addressing this need.”
The company has donated approximately 2.6 million lbs. of food since March 2, according to the release, and is preparing to donate an additional 1.5 million lbs.
“A total of four million pounds, or 16 million meals, are being donated by Tyson Foods to our team members, Feeding America food banks, community pantries near our operations and other hunger relief agencies,” the release said.
As part of this effort, the company will deliver nearly 500,000 lbs.of food to its plant locations “to support our hourly team members who are working hard to keep America and its communities fed,” the release said. “This will be an ongoing effort to ensure hunger relief needs are being met as conditions adjust and change.”
And because school closures have become a common occurrence...
Sanderson Farms and Tyson Foods upgraded as coronavirus-related demand sends meat 'flying off the shelves'
By Tonya Garcia, MarketWatch
March 20, 2020
Sanderson Farms Inc. and Tyson Foods Inc. were both upgraded to overweight from neutral at JPMorgan as coronavirus-related demand sends meat "flying off the shelves" at grocers.
Analysts think the demand is offsetting foodservice weakness. "In addition, because meat is a perishable product (and given limited freezer space in homes), the reversal of today's pantry-loading benefits should be relatively muted," analysts said.
Channel checks in New York and California show that chicken was hard to find. Analysts think these companies are shifting merchandise from foodservice to grocers for consumers...
Why Tyson Is Producing More Meat For Grocery Stores Right Now
Other suppliers are also picking up the pace to prevent shortages.
Rhian Hunt, The Motley Fool
Mar 19, 2020
As the coronavirus prompts many restaurant chains to shut down the dine-in portion of their businesses, and people cut back sharply on eating in public spaces to avoid potential infection, Tyson Foods (NYSE:TSN) has shifted meat production toward meeting grocery store demand. Food companies use different cuts, packaging, and processing to prepare meats for restaurant kitchens, which operate on a commercial scale, and supermarket meats destined for home cooking.
With many staples selling out at grocery stores across the U.S., Tyson decided to shift its operations toward supplying the sector currently seeing the highest demand. In a company statement published on the Tyson blog, company president Dean Banks pointed out that there is no meat shortage in America at the current time, and the challenge simply lies in moving meat products to the places they're needed most.
Tyson has changed over a portion of its production of all three kinds of meat it processes -- chicken, pork, and beef -- to the retail sector. The company cites the flexibility of its operating model...