Pilgrim’s Pride delivered second-quarter results that outperformed Wall Street expectations, marking another period of growth driven by its diversified portfolio and operational improvements. Management emphasized the benefits of strong commodity chicken markets, increased demand for branded offerings, and progress in both U.S. and international operations. CEO Fabio Sandri highlighted the “continued affordability of chicken compared to other proteins” and noted that prepared foods and branded products achieved double-digit growth. The company’s focus on cost controls and efficiency measures also contributed to improved margins, particularly in its U.S. and European businesses.

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While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Pilgrim's Pride’s Q2 Earnings Call

• Benjamin M. Theurer (Barclays) asked about the timing and sourcing strategy for the new Georgia prepared foods plant. CFO Matthew Galvanoni explained that most capital spending will occur in 2026 and the plant will use both internal and external chicken supply.
• Andrew Strelzik (BMO Capital) inquired about pullet and egg set trends and their impact on industry capacity. CEO Fabio Sandri described ongoing hatchery bottlenecks and industry efforts to improve productivity through flock management.
• Pooran Sharma (Stephens) questioned whether deeper seasonal production cuts are needed this year. Sandri responded that typical Q4 cuts are expected, with supply and demand likely to remain balanced barring significant market changes.
• Guilherme Palhares (Santander) sought clarification on rising costs of goods sold and labor trends. Sandri noted proactive overstaffing in Q2 to mitigate visa policy impacts and described the company’s competitive wage strategy to maintain full staffing.
• Peter Thomas Galbo (Bank of America) probed the rationale for consecutive special dividends and capital allocation priorities. Sandri emphasized that capital returns are driven by strong cash flow and a leverage ratio below target, with continued focus on organic and potential inorganic growth.

Catalysts in Upcoming Quarters

Our analyst team will be watching (1) the rollout and ramp-up of the new Georgia prepared foods plant and associated distribution wins, (2) progress on plant conversions and capacity expansions in Mexico and the U.S., and (3) signs of sustained consumer demand for value-added and branded chicken products across retail and foodservice. Additionally, we will monitor how management navigates input cost volatility and labor market developments, both of which could influence profitability.

Pilgrim's Pride currently trades at $49.60, up from $47.71 just before the earnings. Is there an opportunity in the stock?Find out in our full research report (it’s free).

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