Tyson priced 23,810,000 shares of Class A common stock at $37.80 a share and 30 million of its 4.75% tangible equity units at $50 each. These two offerings are separate.
The common stock offering includes a 30-day option for underwriters to purchase up to an additional 3,571,500 shares. The company expects net proceeds from this offering of $873 million, or $1.004 billion if underwriters exercise their full option. Tyson expects net proceeds of $1.454 billion from the equity units offering. The company plans to use these proceeds to help fund its acquisition of Hillshire Brands (HSH).
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The stock was down 1.91% to $37.47 at 10:17 a.m. Nearly 12 million shares had changed hands, compared to the average volume of 4,609,930.
Separately, TheStreet Ratings team rates TYSON FOODS INC as a "buy" with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:
"We rate TYSON FOODS INC (TSN) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, growth in earnings per share, attractive valuation levels and increase in net income. We feel these strengths outweigh the fact that the company shows low profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- TSN's revenue growth has slightly outpaced the industry average of 2.6%. Since the same quarter one year prior, revenues rose by 10.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 49.39% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, TSN should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- TYSON FOODS INC has improved earnings per share by 5.8% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, TYSON FOODS INC increased its bottom line by earning $2.32 versus $1.68 in the prior year. This year, the market expects an improvement in earnings ($2.88 versus $2.32).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Food Products industry average. The net income increased by 4.4% when compared to the same quarter one year prior, going from $249.00 million to $260.00 million.
- You can view the full analysis from the report here: TSN Ratings Report