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Tyson Foods: Beefing Up Your Portfolio

Feb. 11, 2019 11:14 AM ETTyson Foods, Inc. (TSN)5 Comments
Yanni Lodato profile picture
Yanni Lodato


  • Tyson operates a well operated and competitively advantaged business.
  • The stock offers great return on investment.
  • Shares are undervalued allowing for a great entry point.

Source: Google Images

With $40 billion in annual revenues, Tyson Foods (NYSE:TSN) is a powerhouse in the packaged food and edibles space. The company boasts preeminent brand names ranging from Hillshire Farms, Ballpark Franks, and Tyson chicken. With formidable capital appreciation, an appealing dividend yield of 2.53%, and a consumer defensive business, the stock is worth an in-depth examination to discuss its investment suitability. This article will provide my investment thesis on TSN discussing business strengths, valuation, growth, and relevant financials in order to render a buy or sell rating.

Investment Thesis

TSN offers investors a great investment opportunity that helps mitigate portfolio downside risk, offers increasing income through dividends, and provides a stable long-term outlook. TSN's demonstrates distinct business advantages ranging from inelastic demand for the company's food products, significant scale advantages, and great operational oversight. TSN is one of the largest global processors of chicken, beef, and pork with operations in over 125 countries. The food giant has a formidable brand portfolio with dominant brands ranging from Hillshire Farms, Ballpark Franks, Sara Lee, Jimmy Dean, and Tyson chicken.

The company's revenues originate from five operating segments ranging from chicken, beef, pork, prepared foods, and others with the following respective revenue weightings (30.1%, 38.6%, 8.9%, 21.6% and 0.8%). TSN has continued to diversify its food staple offerings and broaden the company's exposure to the packaged food market through a number of acquisitions in different food areas. In 2016, TSN acquired Hillshire brands, a large manufacturer of mass branded meat and bakery products and in 2017 TSN acquired Advance Pierre Food Holdings, a distributor of ready to eat sandwiches and entrées, and snacks. Continued operational focus on diversifying the brand will extract significant benefits as it will help expand revenues and mitigate pricing difficulties in specific food markets.


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This article was written by

Yanni Lodato profile picture
Oracle Investment Research helps individual investors find high-quality stocks with strong competitive advantages suitable for long-term holding. We cover dividend stocks, us stocks, and high growth advantageous risk reward stock opportunities ----------------------------------------------------------------------

Analyst’s Disclosure: I am/we are long TSN. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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