Tyson Foods Reports 'Volatile and Uncertain' Third Quarter, Beats on EPS

Major meatpacking and processing company Tyson Foods (NYSE: TSN) reported its fiscal third-quarter 2020 results this morning before market open, outpacing analyst expectations on some metrics while missing on others. A standout beat from the report came in the form of adjusted earnings per share (EPS) of $1.40. With analyst consensus setting adjusted EPS at $0.90, the food giant delivered a 55% positive earnings surprise.

Tyson's revenue (sales) came in at $10.02 billion, $540 million short of analyst predictions of $10.56 billion. This represents a negative surprise of 5.4%. The company still had $3.1 billion in liquidity available as of June 27.

A collage of stock graphs and coronavirus virions.

Image source: Getty Images.

Tyson CEO Noel White said in a statement, "our third fiscal quarter was one of the most volatile and uncertain periods I've seen during my time in the industry." The report notes the company's Q3 results were "negatively impacted by approximately $340 million of direct incremental expenses related to COVID-19."

Beef volume was hit particularly hard by the coronavirus situation, with volume sinking 23.8% in Q3. This was offset to some degree, however, by an 11.6% average price rise. Pork volume dropped 16.5% and chicken volume by 4.2%. Volume jumped by 25% for Tyson's international segment, but this part of the business is much smaller than the others and saw prices drop 9.2% in any case.

Tyson's stock is down slightly in morning trading. Looking ahead to fiscal 2021, the company says it expects domestic protein production to rise 1% overall. It also notes its "liquidity is expected to be adequate to continue to run our operations and meet our obligations as they become due."

10 stocks we like better than Tyson Foods
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Tyson Foods wasn't one of them! That's right -- they think these 10 stocks are even better buys.

See the 10 stocks


*Stock Advisor returns as of June 2, 2020


Rhian Hunt has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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


More Related Articles

Sign up for Smart Investing to get the latest news, strategies and tips to help you invest smarter.