Tyson Foods, Inc. TSN is focused on enhancing its operations by optimizing its plant network. Taking another step in this regard, the meat products giant inked a deal to divest its Vienna, GA, poultry complex to House of Raeford Farms. The news seemed to have boosted investors’ sentiments, as shares of TSN moved up almost 2% in the after-market trading session on Jul 9. 

While the Vienna, GA, poultry complex divestiture will help TSN enhance its operations, the company will continue to cater to customer orders through other production locations. That said, House of Raeford Farms will continue processing poultry at the abovementioned complex by leveraging the existing workforce and grower network.

Tyson Foods Continues to Boost Efficiency

Tyson Foods has taken bold actions to enhance operational efficiency, including plant closures, improvements in live operations, yield optimization and labor efficiency. This effort has involved the closure of the last of six chicken facilities, as well as two case-ready beef facilities. These actions fuel efficiencies across segments. 

Additionally, TSN is investing in capacity expansion and automation technology investments. Management continues to accelerate digitalization via supply chain planning and execution processes to enhance customer service. The company is optimizing its plant network by adding fully cooked capacity, converting plants for value-added production, executing plant flexibility and strengthening the portfolio mix. Tyson Foods projects capital expenditures in the $1.2-$1.4 billion band for fiscal 2024. These include expenditures related to capacity expansion, automation, and product and brand innovation.

Meanwhile, Tyson Foods is focused on efforts to expand into the international markets as part of its strategic growth plan. Recently, the company inaugurated a new fully cooked food production facility in Danville, VA, worth $300 million. This action goes in tandem with Tyson Foods’ strategy to fuel sustained growth, enhance operational efficiency and invest in its poultry space. In other moves, the company acquired Williams Sausage Company in May 2023, which has solidified its product portfolio and manufacturing capacity.

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Key Strategies Underway

Tyson Foods’ growth strategy is based on three main pillars. These include driving growth across the core protein platform. The company expects global demand for protein to continue rising and remains well-placed to cater to it. Tyson Foods maintains a leadership position in the protein industry, boasting some of the most renowned brands in food and a wide range of offerings. This resilience allows it to sustain a healthy market share despite a challenging consumer environment. 

While Tyson Foods is pleased with its brand strength, it is constantly building innovations to expand the appeal and market opportunities for its products. The company is benefiting from operational enhancements while making incremental improvements in yield and live operations. Ongoing productivity initiatives based on procurement, logistics and digitalization are likely to solidify the company’s fundamentals. The company is refining its digital capabilities, leveraging data, automation and AI technology to enhance decision-making and drive better outcomes.

The abovementioned initiatives are likely to fuel this Zacks Rank #3 (Hold) company’s growth. Shares of TSN have risen 3% in the past six months compared with the industry’s growth of 5.2%.

3 Food Stocks Worth Relishing

Vital Farms Inc. VITL offers a range of produced pasture-raised foods. It currently sports a Zacks Rank #1 (Strong Buy). VITL has a trailing four-quarter average earnings surprise of 102.1%. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Vital Farms’ current financial-year sales and earnings indicates growth of 22.6% and 62.7%, respectively, from the year-ago reported numbers.

Freshpet, Inc. FRPT, a pet food company, has a trailing four-quarter earnings surprise of 118.2%, on average. FRPT currently sports a Zacks Rank #1.

The Zacks Consensus Estimate for Freshpet’s current financial-year sales and earnings suggests growth of 24.8% and 177.1%, respectively, from the prior-year reported level.

Utz Brands Inc. UTZ, which manufactures a diverse range of salty snacks, currently carries a Zacks Rank #2 (Buy). UTZ has a trailing four-quarter earnings surprise of 2%, on average. 

The consensus estimate for Utz Brands’ current financial-year earnings calls for growth of 26.3% from the year-ago reported numbers.

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