Tyson Misses, Guides Lower

A rough performance in beef is to blame.
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Tyson Foods'

(TSN) - Get Report

fourth-quarter earnings missed Wall Street estimates, and the company, which is grappling with a difficult market for beef at home and abroad, guided 2006 lower.

The husbandry farmer earned $98 million, or 28 cents a share, in the latest quarter, including one-time items that boosted EPS by 3 cents. Analysts were forecasting earnings of 30 cents a share in the quarter. A year ago, Tyson earned $66 million, or 19 cents a share.

Sales fell to $6.5 billion in the latest fourth quarter, which had 13 weeks, from $7.1 billion in the year-ago quarter, which had 14 weeks. Analysts were forecasting sales of $7.03 billion in the most recent quarter.

By segment, chicken sales totaled $2.09 billion in the latest quarter compared with $2.31 billion a year ago; beef sales were $2.95 billion compared with $3.15 billion; and pork sales were $763 million compared with $889 million.

For 2006, Tyson expects to earn 95 cents to $1.25 a share. Analysts were forecasting $1.33 a share.

"We are encouraged by recent developments in export market access, but fiscal 2006 will present only gradual recovery in beef as those markets begin to open and cattle supplies improve," Tyson said. "As domestic hog supplies continue to improve, the pork segment should generate more normal returns. We expect our chicken business to remain solid, and our Prepared Foods' segment market share to improve."

The stock last traded at $18.50, or 14.8 times the high end of next year's guidance.