Bearish results in the beef segment from Tyson Foods ( NYSE: TSN ) hit major Brazilian beef producers on Monday.
In its Q4 earnings report released on Monday, the Arkansas-based protein-focused company posted disappointing results, colored by profits that declined sharply from the prior year . Beef and pork sales lagged in particular, with the former falling 8.5% as prices eroded and sales volume of the latter sagging 7.4%.
“The USDA projects domestic production will decrease approximately 5% in fiscal 2023 as compared to fiscal 2022,” Tyson noted in its earnings release. “We anticipate an adjusted operating margin of 2% to 4% in fiscal 2023 as margins are expected to decrease from historically high levels.”
The erosion of pricing dynamics for beef in particular appeared to sting some of Tyson’s competitors in that segment, the largest of whom are headquartered in Brazil. Shares of both BRF SA ( NYSE: BRFS ) -9.45% and JBS SA ( OTCQX:JBSAY ) -3.62% declined sharply following the results.
While strength in prepared foods, that includes some meat alternatives, was signaled by Tyson Foods ( TSN ), alternative protein peers like Beyond Meat ( BYND ) -8.18% and Tattooed Chef ( TTCF ) -8.5% slumped on Monday as well. Poultry giant Pilgrim’s Pride Corporation ( PPC ) also slipped 2.11% on Monday despite chicken serving as a bright spot in Tyson’s results as well.
Read more on Monday’s broader trading action .
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Brazilian beef producers fall on back of Tyson results