Tyson Foods Inc.
) is set to report its fiscal 2013 first quarter results on May
6, 2013 before the opening bell. In the last quarter, the company
posted a 23.1% positive surprise. Let's see how things are
shaping up for this announcement.
Factors this Past Quarter
Strong sales in Chicken and Beef segments coupled with
operational efficiency helped Tyson gain a decent profit in the
past quarter. Moreover, Tyson is foraying into Mexican food
business with its strategic acquisition of Don Julio. This is
particularly encouraging as Mexican food is gaining fast
popularity in the U.S. processed food industry.
However, rising input prices, skyrocketing cattle prices and
grain costs have been crippling margins for the company.
Moreover, currency headwind also posed a problem for Tyson, as
its major portion of business is carried overseas.
Our proven model does not conclusively show that Tyson Foods
is likely to beat earnings this quarter. That is because a stock
needs to have both a positive Earnings Expected Surprise
Prediction or ESP (Read:
Zacks Earnings ESP: A Better Method
) and a Zacks Rank of #1, 2 or 3 for this to happen. That is not
the case here as you will see below.
The Most Accurate estimate stands at 44 cents while the Zacks
Consensus Estimate is at 46 cents. That is a difference of
Zacks Rank #4 (Sell):
Tyson'sZacks Rank #3 (Hold) lowers the predictive power of ESP
because the Zacks Rank #3 when combined with a negative ESP makes
surprise prediction difficult. We caution against stocks with
Zacks Rank #4 and #5 (Sell rated stocks) going into the earnings
announcement, especially when the company is seeing negative
estimate revisions momentum.
Other Stocks to Consider
Flowers Foods, Inc.
), with an Earnings ESP of +14.63% and a Zacks Rank #1 (Strong
The Hillshire Brands Co.
), with an Earnings ESP of +9.38% and a Zacks Rank #2 (Buy).
Molson Coors Brewing Company
), with an Earnings ESP of +2.86% and a Zacks Rank #3 (Hold)
FLOWERS FOODS (FLO): Free Stock Analysis
HILLSHIRE BRAND (HSH): Free Stock Analysis
MOLSON COORS-B (TAP): Free Stock Analysis
TYSON FOODS A (TSN): Free Stock Analysis
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