Tyson Foods (TSN) Stock Analysis: Can We Capitalize On This Declining Stock?

Table of Contents


All articles are for education purposes only, and not to be taken as advice to buy/sell. Please do your own due diligence before committing to any trade or investments.


All articles are for education purposes only, and not to be taken as advice to buy/sell. Please do your own due diligence before committing to any trade or investments.

tyson foods

Table of Contents

This article is for education purposes only, and not to be taken as advice to buy/sell. Please do your own due diligence before committing to any trade/investment.

Great food.

Not many can resist.

I live to eat. There’s no way I will decline tasty food.

Today, let’s have a close look at this food producer company and uncover if there are shorting opportunities: Tyson Foods.


Brief History of Tyson Foods

Source: unsplash.com

Tyson Foods started as a poultry delivery service in 1931, in the middle of the Great Depression.

It overcame the challenges faced to expand vertically. This meant the raising of chickens, feed production, and meat processing.

Over time, the company grew organically and through acquisitions, placing the company on the global stage.

Eventually, Tyson Foods added pork and beef to its lineup of meat.

Tyson Foods has also been giving back to the community as part of its philosophy since the 1970s. Don Tyson (the CEO of Tyson Foods then) mentioned in his annual report: “Tyson Foods believes that, if we don’t take an active part in the community, we won’t deserve a place in it very long.”

Understanding how Tyson Foods has grown since inception, it’s time to focus on its financials over the last couple of years. This will help to shape your outlook for Tyson Foods.


Business Model and Financials

Tyson Foods income statement

Source: tradingview.com

Looking at the bar graph above, you can easily tell that Tyson Foods’ total revenue has been growing every year since 2016.

Growth has been between 1.78% and 5.98% from 2017 to 2020.

Its total revenue grew at a faster pace in 2021 and 2022, registering growth of 8.95% and 13.25% respectively.

This is a good sign, or is it?

Let’s have a look at its net income.

Tyson Foods’ net income fluctuates wildly.

It grew by a modest 0.34% in 2017, but growth shot up to 70.46% in 2018, before shrinking by 34.52% in 2019.

In 2020, it experienced a modest growth of 4.09% before skyrocketing to 47.84% in 2021, and returning to 6.27% in 2022.

Such wild fluctuations are a turn off for investors.

In Tyson Foods’ 2023 earnings report, the company reported a small increase in its sales revenue y-o-y while a sharp drop in its adjusted operating income and adjusted earnings per share.

Tyson Foods earnings report

Source: ir.tyson.com/presentations/default.aspx

This is very concerning.

Understanding its financials, I’m inclined to look for short-selling opportunities.

Therefore, shall we have a look at its chart to decide if there’s a short-selling opportunity?


Technical Analysis on Tyson Foods (NYSE: TSN)

Chart of Tyson Foods

Given its vulnerable financial health, it’s no surprise that investors have been dumping the shares of Tyson Foods.

They have been doing so since late April 2022, nearly a year ago!

Will it be a good idea for you to join the party now?

To answer this question, let’s refer to the 2 indicators on its chart above – the red arrow and Trend Impulse Factor indicator.

The first indicator to watch for is the red arrow.

Ah yes! The red arrow is out on the latest candle of Tyson Foods. This suggests that there’s renewed bearishness.

Now, it’s time to pay attention to the bar of its Trend Impulse Factor indicator.

A dark green bar of its Trend Impulse Factor indicator implies that the bearish momentum is highly likely to continue, providing you a wonderful opportunity to sell Tyson Foods’ shares short.

Is it dark green in color?

Unfortunately, it isn’t dark green in color yet.

This leads you to the conclusion that the opportunity to short its shares isn’t ripe yet. You’ll be better off waiting.



Tyson Foods Brands

Source: tysonfoods.com/our-brands

Tyson Foods is a well established meat producer that has been enjoying success and growth for many years.

Its ability to strategize and execute has been instrumental to its massive growth into the global brand that we know today.

However, a dig into its latest earnings announcement has brought about more questions than answers.

A look at its chart reveals pessimism, with the appearance of the red arrow. Despite this, the bar of the Trend Impulse Indicator isn’t dark green in color yet.

The red arrow and Trend Impulse Factor indicator have been tested and proven. They form the TradersGPS (TGPS) system to help you decipher if a stock is a cut above its peers. You won’t have to feel in the dark and make wild guesses

Therefore, it’s not time to take a short position trade on Tyson Foods.


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Eric Lim

Having being coached in trading and in many aspects of life, Eric is a firm believer of success being the result of having a strong foundation. Hardwork, dedication, and practice are essential ingredients. He's always fascinated by the stock market and enjoys sharing his knowledge and discovery of the markets as a form of giving back to society. Swing and position trading are his favorite trading strategies.

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