Tyson Foods shares rise after earnings beat expectations

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hares of Tyson Foods Inc. TSN, +1.59% rose nearly 1% in Monday premarket trading after the meat producer reported third-quarter earnings that beat expectations. Net income totaled $527 million, or $1.44 per share, down from $676 million, or $1.84 per share, last year. Adjusted EPS of $1.40 beat the FactSet consensus for 94 cents per share. Sales of $10.02 billion were down from $10.89 billion last year and below the FactSet consensus for $10.56 billion. Beef sales fell to $3.65 billion from $4.16 billion last year, though the average price for beef rose 11.6%. Tyson attributed a reduced sales volume to lower capacity caused by a first-quarter fire at a production facility that led to its temporary closure. Average pork price also rose, up 0.8%, with sales totaled $1.12 billion, down from $1.32 billion. Tyson chicken prices fell 2.4%, and chicken sales fell to $3.11 billion from $3.33 billion. Lower foodservice demand hurt chicken sales, the company said. Tyson incurred COVID-19-related incremental expenses of $340 million during the quarter, including worker bonuses, testing and personal protective equipment. Tyson did not provide guidance due to the uncertainty surrounding the coronavirus pandemic. In a separate release, Tyson announced that Dean Banks will succeed Noel White as chief executive of the company, effective October 3. Banks will also retain his title as president. White will stay on as executive vice chairman of the board, a new role. Banks was previously at X, part of Alphabet Inc. GOOG, -0.57% GOOGL, -0.34%, and was a managing partner at Seed Ventures, which invests in healthcare technologies. Tyson stock has slumped 31% for the year to date while the S&P 500 index SPX, +0.71% has gained 2% for the period.

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