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BiG Research Flash Note: Tyson Foods

Tyson Foods is one of the world’s largest food companies. It specializes in the area of
protein and the transformation of livestock (hogs, chickens and cattle) into various
quality types of raw meat cuts for sale to further processors, who transform the meat
into cooked products for the final consumer. It employs approximately 121,000 people
(mostly in the US) and it sells to over 125 countries (although the US makes 90% of their
revenues). Its industry is highly regulated, including at the federal level, due to the
potential dangers of environmental pollution or food contamination. Agreements with
costumers are generally short-term and the industry is intensely competitive with
operating margins typically below 10%. Business also depends highly on open market
prices as most of the livestock they process is acquired directly from producers (no
long-term contracts on materials or outputs). Walmart is their biggest costumer, with
17.3% of 2018 sales flowing to it.