Tyson Foods, Inc. - Ordinary Shares - Class A (TSN)

⚠️ Not Shariah Compliant - Tyson Foods is an American protein conglomerate with a substantial pork segment, generating roughly USD1.6 billion in pork sales per quarter, plus pork-based prepared foods brands such as Jimmy Dean sausage, Hillshire Farm, and Wright Brand bacon. Direct exposure to pork processing and sales makes this stock non-compliant under Shariah screening. This research is provided for market education only, not investment solicitation.

America's largest protein company

Tyson Foods (TSN) is the largest producer and processor of protein in the United States, operating across four core segments - Chicken, Beef, Pork, and Prepared Foods. Brands under the Tyson umbrella include Tyson, Jimmy Dean, Hillshire Farm, Ball Park, Wright Brand, and State Fair - many of them household names in the American market.

The core story: "A Tale of Two Proteins"

The most important thing to understand about TSN right now is the massive divergence between its two largest segments:

• Chicken - record profits. Low grain and feed costs (corn, soybean), a consumer shift toward cheaper protein, and greater operational efficiency after the 2023-24 plant closures drove a 12.2% operating margin in Q2 FY26 - among the best in the segment's history.
• Beef - a historic loss cycle. The Beef segment posted an adjusted operating loss of $202 million in Q2 FY26 alone, and the company guides to a full-year FY26 loss of $350-500 million.

Why is beef losing money? Understanding the "cattle cycle" simply

The US cattle herd currently sits at its lowest level in roughly 70-75 years, driven by a prolonged drought affecting more than 70% of ranching regions. This creates a counterintuitive paradox: when ranchers want to rebuild their cattle herds, they must HOLD BACK female cattle (heifers) for breeding rather than sell them for slaughter. That means the supply of cattle available for processing gets even tighter in the short term - before it can recover in the long term. Live cattle costs have surged, but processors like Tyson cannot raise meat prices as fast as costs rise, so they lose money on every animal processed. Herd rebuilding takes 2-3 years biologically (gestation plus growth time), so beef losses are expected to persist through at least FY2027.

Prepared Foods as the stabilizer

The Prepared Foods segment (Jimmy Dean, Hillshire, Ball Park) posted the group's highest operating margin at 14.0%, acting as a "moat" that stabilizes company earnings compared to pure-play competitors dependent solely on raw commodities.

Tyson family control

Tyson operates under a dual-class share structure. The Tyson family, through the Tyson Limited Partnership, holds nearly all Class B shares (10 votes per share) plus a small stake in Class A, giving them control of roughly 72% of voting power despite a much smaller economic interest. Chairman John H. Tyson represents the third generation of the founding family, while CEO Donnie King is not a family member.

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