Tyson, Pilgrim's Pride shares get lift from upgrade
NEW YORK - Shares of the nation's two largest poultry producers, Tyson Foods Inc. and Pilgrim's Pride Corp., rose sharply Monday after an analyst upgrade, citing stocks that look cheap by historical measures and improving economics in the meat industry.Tyson, of Springdale, Ark., saw its shares add 5.7%, or 83 cents, to close at $15.28. Pilgrim's Pride, of Pittsburgh, Texas, rose 6%, or $1.52, to finish at $26.94. J.P. Morgan analyst Pablo Zuanic upgraded both companies' stocks to overweight from neutral, saying both trade well below historical price-to-earnings multiples on a normalized basis. The cyclical nature of the chicken and beef businesses was also a factor, the analyst said.
"With chicken industry economics already back at [the] midpoint of the cycle, we see upside on Pilgrim's Pride," Zuanic said in a note to clients. "Tyson should benefit both from improving beef packing and chicken industry economics."
Source: MarketWatch
11 July 2006
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