Shares of Tyson Foods (TSN) are rallying after the company's first quarter earnings per share topped analysts' consensus estimates. The company also raised its profit outlook for fiscal year 2016.

WHAT'S NEW: Prior to the market open this morning, Tyson Foods reported Q1 adjusted EPS of $1.15, easily topping analyst's consensus estimates of 89c. However, the company's Q1 revenue of $9.15B missed analysts' estimates of $10.07B, and the company noted that average sales prices decreased in the quarter due in part to higher domestic availability of fed cattle and live hog supplies. Tyson also noted that feed costs declined $60M during Q1. Additionally, the company also raised its share repurchase authorization by 50M shares.

GUIDANCE: Looking ahead to FY16, Tyson Foods raised its EPS view to $3.85-$3.95, ahead of analysts' consensus estimates of $3.63. The company's sales view for FY16 was lowered to approximately $37B from its previous estimate of $41B, below analysts' estimates of $39.83B. The company cited declines in beef, pork and feed prices. Tyson Foods sees domestic protein production for the fiscal year up 2%-3% and believes the chicken segment's operating margin will improve to 11% in 2016, up from its previous 10% outlook. Tyson also sees lower future feed costs in FY16 compared to FY15 of approximately $200M based on current futures prices. Further, Tyson sees its beef segment's operating margin "at or above" the low end of its normalized range of 1.5-3% for FY16 and its pork segment's operating margin above its normalized 6%-8% range, up from its previous estimate of within the range. The company also sees synergies of over $500M in FY16 from its acquisition of Hillshire Brands and sees FY16 capital expenditures of $900M.

EXECUTIVE COMMENTARY: On the company's earnings conference call, Donnie Smith, the company's chief executive officer, said he believes that "the worst is over" in terms of the cattle supply. While he believes beef will still be expensive to consumers, he noted that customers are spending more at the grocery store.

PRICE ACTION: In late morning trading, Tyson Foods rose $5.16, or about 10%, to $57.13 on nearly twice its average daily trading volume. Earlier in the session, the stock made a fresh 52-week high of $58.94. Including the advance, the stock is up approximately 43% over the past 12 months.

OTHERS TO WATCH: Other food producers include Hormel Foods (HRL), Sanderson Farms (SAFM) and Pilgrim's Pride (PPC).