Jefferies Initiates Tyson Foods With A Buy Rating, $22 PT

Jefferies is initiating coverage on shares of Tyson Foods, Inc.

with a Buy rating and $22 price target. Jefferies said that its outlook and commentary on Tyson's most influential (based on 6-year correlation analysis) share price drivers follows: “Tyson shares have historically moved in the opposite direction of chicken and pork cold storage levels, which we expect to be relatively flat in 2011,” Jefferies writes. “We expect the protein price index to trend just below record 2010 levels in 2011, but well above the five-year mean, as higher pork and beef prices are offset by lower chicken prices. “2011 protein margins will likely fall short of record 2010 levels, but remain historically high. “Current FY11 Street estimate implies little confidence that Tyson can deliver on additional cost savings in FY11 – we disagree.”