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Tyson Foods (TSN) Queued for Q2 Earnings: What's in Store?

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·4 min read
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Tyson Foods, Inc. TSN is likely to post an increase in the top and the bottom line when it releases second-quarter fiscal 2021 numbers on May 10. The Zacks Consensus Estimate for revenues is pegged at $11.2 billion, which suggests a rise of 2.9% from the figure reported in the prior-year quarter.

The Zacks Consensus Estimate for the bottom line has remained unchanged at $1.11 per share in the past 30 days. The estimate suggests a growth of 44.2% from the year-ago quarter’s reported figure. Notably, this meat product giant’s bottom line has outpaced the Zacks Consensus Estimate by 22.8% in the last reported quarter and it has a trailing four-quarter earnings surprise of 24.8%, on average.

Tyson Foods, Inc. Price and EPS Surprise

Tyson Foods, Inc. Price and EPS Surprise
Tyson Foods, Inc. Price and EPS Surprise

Tyson Foods, Inc. price-eps-surprise | Tyson Foods, Inc. Quote

Key Factors to Note

Tyson Foods is gaining on rising demand in its retail channel, thanks to increased at-home consumption amid the pandemic. Given the rising demand, the company shifted part of its foodservice production to concentrate on retail. We believe that continued at-home dining practices are likely to have had a positive impact on retail volumes in the second quarter of fiscal 2021.

Additionally, the company’s e-commerce business is seeing solid growth as more consumers are buying online amid the pandemic. Certainly, continuation of this trend is likely to have aided top-line growth in the to-be-reported quarter. Apart from these, Tyson Foods is benefiting from its brand strength, robust geographical reach and the ability to manufacture locally in its international markets as well as cater to the evolving global demand. Notably, the company has been focused on higher protein production to cater to the rising demand for protein-packed food.

Though Tyson Foods is seeing increased retail demand, foodservice channel remains affected thanks to reduced demand and lower production amid COVID-19. Apart from this, the company is grappling with direct incremental expenses associated with the pandemic. These include team member costs, production facility sanitization and testing for coronavirus among others. Also, indirect COVID-19 costs including expenses associated with raw materials and transportation among others is a concern.

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Tyson Foods this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Tyson Foods carries a Zacks Rank #3 and an Earnings ESP of 0.00%.

Stocks With Favorable Combinations

Here are some companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat.

Franchise Group, Inc. FRG currently has an Earnings ESP of +4.02% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Energizer Holdings, Inc. ENR currently has an Earnings ESP of +4.17% and a Zacks Rank of 3.

Monster Beverage Corporation MNST currently has an Earnings ESP of +0.41% and carries a Zacks Rank #3.

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