We arrive at our $60 target price for TSN shares by using a sum-of-the-parts methodology that values each of the company’s reporting segments on EV/EBITDA. We value Chicken at 7.5x our 2025E EV/EBITDA estimate, Beef and Pork at 6.0x, Prepared Foods at 9.0x, and International at 7.0x, based on historical average. This results in a weighted average EV/EBITDA multiple of 7.9x.

TSN’s upside risks to our target price include: 1) Beef margins could rebound from depressed levels; 2) TSN’s past mid-cycle targets would imply the potential for significant EPS upside over time; and 3) Chicken margins could be stronger than expected.

TSN’s downside risks include: 1) Beef could get worse; 2) operational challenges could linger; and 3) the recent improvement in Pork processing margins could be temporary.