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Opinions Stan Wong
Tyson Foods Inc.TSNDON'T BUYSep 17, 2015
Stan WongStock price when the opinion was issued
As of Jun 16, 2026. Market Open.
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TSN pays a good yield of 4%, and management has grown its dividends nicely over the past 10 years. Sales growth is expected to be modest in the next few years (low single digits), and it generates a good level of operating cash flows. Its margins have contracted over the past 12 months, and it has missed on its five past earnings results. Its balance sheet is strong, with a good cash balance of $706M and an equity position of $18.9B. It has its strengths and operates in a defensive sector. We would be comfortable with this name for income, but we do not expect much in the way of growth in the near to intermediate term.
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Premium content(A Top Pick Jan 14/21, Up 15.6%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with TSM has triggered its stop at $75. We recommend covering any holdings at this time. Combined with our previous recommendation to cover 50% of the position, this results in a total investment return of 19%.
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William Chin
Has done okay in the last little while because of their acquisition of Hillshire Brands last year. That is going to provide the company with entry into the wider margin prepared foods market. Valuations are a bit stretched and the growth is not extremely high. Trading at around 13-14 times forward earnings, and the growth rate is probably 6%-8%, so you are not looking at a very robust long-term EPS growth rate. He prefers others.