Tyson Foods, Inc. (NYSE:TSN) stock was down on Friday after analysts at Pivotal Research downgraded the company.
Pivotal Research analysts downgraded Tyson Foods stock from a “Hold” rating to a “Sell” rating on Friday. The research firm also reduced its price target for the stock. The new price target for TSN stock is $40 and the previous price target was $100.
Pivotal Research listed a lawsuit against Tyson Foods as the main reason for it downgrading the stock. The lawsuit alleges that TSN conspired with Koch Foods, Perdue Farms and other chicken producers to fix prices for the food by limiting stock. It claims this has been going on since 2008.
The lawsuit that Tyson Foods is facing was filed by Maplevale Farms, a food distributor based in New York. Pivotal Research believes that this lawsuit could cause meaningful harm to the company, reports TheStreet.com.
“The complaint alleges supply collusion occurred through non-public data exchange; detailed industry reports compiled on a daily or weekly basis by Agri Stats, Inc., a subsidiary of Eli Lilly and Co., and then sold back to industry participants,” Timothy Ramey, an analysts with Pivotal Research, said in a statement obtained by StreetInsider.com concerning the lawsuit against Tyson Foods.
Wall Street analysts currently have an average rating of “Buy” for Tyson Foods. The average price target for the chicken company is $67.93. This is based on six firms that are covering TSN stock.
TSN stock finished trading with a price of $74.38 on Thursday. As of Friday morning, the stock has dropped 10%.
