Pilgrims Pride Corp PPC

Favorable Chicken Markets Drive Robust Results for Pilgrim's Pride but Still Cyclical

Even as the second-largest poultry producer in the US (58% of 2023 sales), the UK and Europe (30%), and Mexico (12%), Pilgrim’s Pride has failed to create a competitive advantage, in our view. It primarily sells fresh chicken and pork (only in Europe), with just 27% of sales coming from prepared products, though this includes private-label offerings. Because meat is a commodity and carries little to no brand or pricing power, it is exposed to volatility in input costs and selling prices. We don’t think the diversification afforded through acquisitions into pork and Europe necessarily reduces that risk, given the limited synergies we see across proteins and regions.