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Factors to Take Note of Before Tyson Foods' (TSN) Q2 Earnings

Tyson Foods, Inc. TSN is scheduled to release second-quarter fiscal 2020 results on May 4. Notably, this renowned meat products company has a trailing four-quarter positive earnings surprise of 0.8%, on average.

Further, the Zacks Consensus Estimate for second-quarter earnings is pegged at $1.21 per share, which suggests an improvement of 0.8% from the year-ago quarter’s reported figure. The consensus estimate has also moved up 16.3% over the past 30 days. The consensus mark for revenues is pegged at $11,129 million, which indicates an increase of 6.6% from the prior-year quarter’s tally.

Key Factors to Note

Rising demand for protein-packed food has been a key catalyst for Tyson Foods. The company boasts a rich portfolio of protein brands. Its Prepared Foods segment is also witnessing retail consumption growth. It has also been undertaking acquisitions along with offloading certain non-protein businesses to increase focus on areas with growth potential. All these factors have most likely bolstered Tyson Foods’ performance in the fiscal second quarter.

However, at its first-quarter earnings, management said that it expects challenges and volatility in the second quarter. For the quarter, Tyson Foods envisions earnings decline on a sequential basis due to persistently soft market conditions with respect to chicken, increase in raw material costs, and normal seasonal cyclicality in beef and pork. Meanwhile, Tyson Foods has been witnessing high input costs in some categories. These along with concerns related to the coronavirus outbreak might reflect on results for the fiscal second quarter.

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. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Tyson Foods, Inc. Price and EPS Surprise

 

Tyson Foods, Inc. Price and EPS Surprise

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

Tyson Foods has a Zacks Rank #4 (Sell) and an Earnings ESP of -2.33%.

Stocks With a Favorable Combination

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

The Hain Celestial Group, Inc. HAIN currently has an Earnings ESP of +9.24% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Campbell Soup Company CPB has an Earnings ESP of +21.06% and a Zacks Rank #2.

Flowers Foods FLO has an Earnings ESP of +7.77% and a Zacks Rank #2.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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