Tyson is also expected to see benefits from the Keystone Foods acquisition that was completed last quarter. In February, the company entered into an agreement to purchase the Thai and European operations of BRF S.A. for $340 million. This acquisition is expected to benefit the company’s protein-rich food products business in particular.
Looking at margins, Tyson is expected to benefit from higher margins in the chicken segment. The prepared foods segment is a high-margin business and can be expected to drive growth going forward. However, the company’s bottom line could be impacted by higher costs in the beef and pork categories.
In the first quarter of 2019, Tyson beat earnings estimates while revenues missed the mark. Revenues totaled $10.2 billion while adjusted EPS fell almost 13% to $1.58.
For the full year of 2019, Tyson expects revenue to be approx. $43 billion and adjusted EPS to be in the range of $5.75 to $6.10.
Tyson’s shares have gained 43% so far this year.