Research Alert: CFRA Reiterates Buy Recommendation On Shares Of Tyson Foods, Inc.

11:30AM ET 11/12/2019 MT Newswires
CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We keep our 12-month target at $100, 13.6x our FY 21 (Sep.) EPS estimate and a premium to the five-year mean of 13x. We lower our FY 20 EPS estimate to $6.56 (was $6.85) and begin FY 21's at $7.35. TSN posts fiscal Q4 adj-EPS of $1.21 vs. $1.58 (-23%), $0.06 below consensus. The previously mentioned challenges impacted EBIT margins this quarter (down 270 bps). However, the good news is that these issues seem to be largely behind the company. For FY 20, TSN did not provide an adj-EPS target due to the uncertainties associated with African Swine Fever and various trade agreements. Instead, TSN expects to meet or exceed its long-term target of "high-single-digit" adj-EPS growth. We find this guidance very conservative and forecast TSN can deliver about 20% adj-EPS growth in FY 20, driven by increased prices (especially in Prepared Foods), significant EBIT margin expansion in the Chicken segment, cost savings and strong export demand due to reduced trade barriers and strong demand.