Did Tyson Insider Sell Shares on Privileged Information?
After Tyson Foods, Inc. (NYSE:TSN) reported quarterly profits that came in lower than analysts expected and dropped its full-year outlook on higher meat prices, the company's shares fell by nearly 8 percent.
Curiously, in the weeks leading up to the announcement, company officials at Tyson sold a total of $3.63 million in shares through insider transactions. Such heavy insider trading in the period before such a negative report may suggest that the public was not privy to the same information given to these officials.
The company did, however, announce on August 6, that it expects the price of meat to continue to rise as drought-stricken lands keep feed prices high. Chief Executive Donnie Smith said the company's beef and pork segments have been hit with "very difficult market conditions," which will result in lower full-year profits than he originally expected.
"While we ultimately expect to pass along rising input costs, these costs, coupled with continued soft demand, are likely to pressure earnings in 2013," he said.
Given the extensive trading activity reported before the company released its results, do you think Tyson executives withheld information from the public?
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