Markets & Finance

Piper Jaffray Upgrades Gold Kist

Piper Jaffray upgrades chicken processor Gold Kist (GKIS) to outperform from market perform.

Analyst Eric Larson says he upgrades on strong earnings outlook and favorable valuation. He says the company reported second-quarter earnings per share of 76 cents on Tuesday, vs. his 40 cents and consensus 41 cents forecasts.

He believes average chicken prices will improve modestly from current levels (about 2%) as demand typically strengthens during summer months. He notes pullet placements and other supply indicators suggest supply will stay in balance near term, which should limit downside price risk.

Larson raises his $1.42 fiscal 2005 (ending September) earnings per share estimate to $2.37.

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