If the signing of the phase one trade deal with China is the "mother of all catalysts" for U.S. stocks, then Tyson Foods, Inc. (NYSE: TSN) could be "the biggest" winner, according to CNBC's Jim Cramer.
Tyson's China Catalyst
China continues to deal with an African swine fever epidemic, which is resulting in a major shortage of pork in the country, Cramer said Thursday on "Mad Money."
Pork is a national staple in China, and the country needs to look outside its borders for a fresh supply of pork products, he said.
Tyson Foods is the largest meat processor in the U.S., and the Chinese market represents a major catalyst for the company, the CNBC host said, adding that the opportunity comes at a time when investors are looking for "companies with powerful catalysts."
Tyson Shares 'Darned Cheap,' Cramer Says
Tyson Foods' stock ended 2019 with strong gains, yet the company's China opportunity makes the stock look attractive at current levels, Cramer said. The stock is trading at just 12 times next year's estimates, which is "darned cheap" and implies Tyson has "a lot more room to run," he said.
Wall Street analysts could soon recognize Tyson Foods' outlook is underappreciated and scramble to move their earnings estimates higher, Cramer said. The basic math implies the stock is "going to look even cheaper" than it does today, he said.
Tyson shares were trading 2.59% higher at $91.50 at the time of publication Friday.
USMCA Trade Deal: Praises, 'Evils,' Plans
Tyson Foods Reports Q4 Earnings Miss
Photo by Leah Kelley from Pexels.
See more from Benzinga
- Ulta Beauty CEO Reflects On The Past 10 Years In CNBC Interview
- The M&A History Of Yum Brands
- Can You Lose Weight By Eating Donuts? Krispy Kreme Thinks So
© 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.