NEW YORK (TheStreet) -- Shares of Tyson Foods (TSN) - Get Report were rising in pre-market trading on Tuesday as the food company took a 5% stake in Beyond Meat, an El Segundo, CA-based company that produces meats made up of plant-based proteins.
Beyond Meat's "Beyond Burger" replaces meat products by using pea protein mixed with coconut and canola oils, the Wall Street Journal reports.
Whole Foods Market (WFM) began selling the Beyond Burger at its mid-Atlantic locations this year.
The move is expected to help Springdale, AR-based Tyson expand into markets beyond its core business of meat processing.
Specialty and international products can also provide a cushion from the typical volatility of commodity meat markets, according to Bloomberg.
Additionally, BMO Capital Markets lifted Tyson's stock rating to "outperform" from "market perform" this morning.
The firm upped its price target to $84 from $77.
Tyson's strong fundamentals should boost fiscal 2017 and 2018 earnings, BMO noted.
Even if the price collusion lawsuit lasts several years, it's unlikely to impact the company's finances, the firm added.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
The team rates Tyson as a Buy with a ratings score of A+. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, attractive valuation levels, largely solid financial position with reasonable debt levels by most measures and notable return on equity. The team feels its strengths outweigh the fact that the company shows weak operating cash flow.