Tyson Foods (TSN) is not worried about President Trump's latest tariffs.
CEO Donnie King told Yahoo Finance that the company would not expect to "see a significant impact" and plans to put tariffs on its annual adjusted operating income forecast.
Meat suppliers raised their forecast by $100 million to $1.9 billion to $2.3 billion, up from $1.8 billion to $2.2 billion.
"We have planned to charge tariffs, immigration and any market dynamics and incorporate it into our year-round guidance," the king told Yahoo Finance over the phone.
Read more: When the deadline for Trump's tariff is approaching, the latest news and update
"Our team has already conducted contingency plans to minimize disruptions to supply chains or impacts for a period of time ... short-term disruptions, but it will balance."
For example, Tyson Foods sends about 10% of each pig it processes to Mexico. If Mexico receives retaliatory tariffs, some reshuffle may be required. Currently, Canada's 25% tariff is expected to take effect on Tuesday, while similar tariffs on Mexico will be available for a month.
He explained: "We might then ship that product out... where the void is, so it will move around. It will change the destination, but be net (neutral impact)."
Other agricultural supplies may hit shoppers’ wallets, including items such as avocados and tomatoes.
According to estimates cited by Joe Feldman of Telsey Advisory Group, the average tax rate for U.S. households will exceed an average tax increase of $800, which will result in proposed tariffs in Mexico, Canada and China.
Tyson Foods was one of Yahoo Finance’s top popular ticket sellers on Monday at its highest revenue expectations and boosted annual sales, thanks to strong demand for chicken and beef.
King called it "the best quarterly performance in more than two years", with third consecutive quarter sales growth, adjusted operating income and adjusted earnings per share.
In the first quarter, net sales rose 2.3% from the same period last year to $13.6 billion, with earnings per share of $1.14.
King attributes the strong quarter to the strategic pillars it sets to “strengthen the foundation” and develop its “brand value-added businesses” such as chicken nuggets and prepared food.
Another important component of the report is the food service business, which has gradually grown in numbers as Americans demand for protein increases. This includes a wide range of production lines, including companies such as Sysco (Syy) and fast-service restaurants such as Wendy's (Wen), Burger King (QSR) and McDonald's (MCD).
Still, JPMorgan analyst Ken Goldman and Bank of America analyst Peter Galbo remain at a neutral rating.
Both quote the challenges surrounding the supply of beef, but the beef slices again quote the beef business, despite strong momentum in its chicken business.
At present, Jin expects that as the cattle herd is slowly rebuilding, the supply of cattle will "continue to sign contracts".
In the first quarter, he added, “more cattle are available than we expected…but the prices of cattle raised will continue to rise.”
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Brooke Dipalma is a senior reporter of Yahoo Finance. Follow her on@在 在Brookedipalma Or send her an email to her through bdipalma@yahoFinance.com.
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