Tyson Foods Inc. (TSN): Solid F3Q results, with visibility for earnings growth into FY27 – Reiterate Buy

研报英文原文证据摘录

Tyson Foods Inc. (TSN): Solid F3Q results, with visibility for earnings growth into FY27 – Reiterate Buy

Goldman Sachs Tyson Foods Inc. (TSN)

strength for chicken given its relative value, along with a further mix shift toward

value-added products and incremental efficiency gains, including tailwinds from

improved genetics.

n Solid share gains for prepared foods, with margin recovery expected to start

next quarter: F3Q Prepared Foods adj SOI decreased -3.9% y/y to $321mm with

~70 bps of margin contraction given $30mm of higher input costs (namely beef

trim). Regarding the top line, we note continued strength with revenue growth of

+1.7%, including volume growth and market share gains, along with tailwinds from

incremental distribution and strong innovation. We also highlight continued

outperformance across its retail branded portfolio (1.5pp better than the total

food/beverage industry), including volume growth of +18.4% for Hillshire combo

snacking, +7.0% for Hillshire Farm lunchmeat, +5.8% for Aidells dinner sausage,

+3.4% for Wright/ Hillshire Farm smoked sausage, and +2.7% for Jimmy Dean

refrigerated breakfast. For FY26, TSN narrowed its SOI guidance toward the upper

end to now range $1.30-1.35bn (vs 1.25-1.35bn prior), along with constructive

commentary on continued growth into FY27, and we see support tied to strong

demand for protein and convenience, reinforced by TSN’s brand investments and

innovation, along with a margin improvement as its input cost recovery should start

in late F4Q given the timing of inventory turns, while we also note freight is a

pass-through cost, with about a 1-2 quarter lag.

n Beef profitability should remain challenged but sequentially improve in FY27:

Challenges in the Beef segment persisted with F3Q adj SOI of -$138mm (vs