Analysts at Piper Jaffray recently upgraded the stock of this chicken producer to ‘Overweight’.
Tyson Foods (TSN)
From Positive Patterns
Tyson Foods (TSN) has the mojo working for it right now. The analysts have been very wrong about TSN this year. Back in February of 2017, the analyst consensus was around $5.00 for this year and a flat 2018 ($5.00, too, for 2018). Here is the very latest from www.zacks.com: $5.82 (actual) in 2017 and $6.10 in 2018; so, for 2017, TSN did about 20% better than the ‘expert’ suggestions.
Note that this year the company is again modest in its expectations, with a $6.10 estimate from Zack’s for 2018. That would be a 5% gain and with the mojo of the Global Economy picking up and a lower Dollar, that’s very good for TSN. I think TSN will beat the estimates in 2018 too!
Cash flow for 2018 (year-end September 2018) should be around $8.50 a share. That means right now you can buy a growth stock for less than 10 times cash flow. I suggest to you that this is an excellent value.
I don’t care where the stock market is; chicken is not cyclical. The demand is steady, reliable and growing. The world needs more protein every year.
When it comes to meat, TSN is a big-time player. I am going to move my buy up to $85 but we can’t chase it forever, but it’s still a good value below $85.
Bob Howard, Positive Patterns, P.O. Box 310, Turners, MO 65765, 417-887-4486, January 16, 2018