Raw Deal

Image source: onemorebox, Thomas Bethge and Rushikesh Shinde shutterstock

What's going on?

Tyson Foods reported better-than-expected quarterly results on Monday, as the US meatpacker charges Americans an arm, a leg, and a trotter or two for their weekly shop.

What does this mean?

Tyson might not be the most glamorous of companies, but Americas shoppers need what its selling: everyones gotta eat, after all. And you have been hungry: Tyson sold its products for 20% more on average last quarter than the same time in 2020, and it still managed to sell the same amount (tweet this). That pushed its operating profit which excludes interest payments and taxes up 40%. Tysons not just making money either: the companys on track to save as much as $400 million this year. Throw in a better-than-expected sales outlook for this year, and investors were sold: they sent Tysons stock up 5%.

Why should I care?

Zooming in: The US vs Tyson.
The US government probably isnt so happy, given that it sees Tyson as one of a small group of meatpackers that holds too much power over prices. In fact, it released a study in December showing that Tyson and three other major producers had increased their combined profits by 500% since the start of the pandemic. That might be why the government announced last month that itll be spending $1 billion on funding smaller firms, which should promote competition in the industry and ultimately bring down prices.

The bigger picture: Buh-bye, Beyond Meat.
Tysons reign doesnt look like its under threat from Beyond Meat either: Dunkin recently ditched the plant-based companys food from its menu, and TGI Fridays said it wont be adding any more of its products. This, despite the fact they were two of the earliest companies to jump on the meat-substitute trend. Some analysts think thats a sign of things to come, and that fast food chains like McDonalds and KFC which have only boarded this bandwagon recently will eventually follow suit.

Originally posted as part of the Finimize daily email.

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