Apparently, it's not "Be kind to meat processor Tyson's (NYSE:TSN) shareholders" day. The company produced a blowout second quarter, beating the highest analyst estimate of $0.29 a share by $0.04 a share, and the stock is down. Go figure.

In fact, an arguably anemic 5.6% increase in revenue masks some impressive sales increases. Of the company's many divisions, sales of prepared foods jumped 76.1%; pork, 22.6%; and chicken, 12.1%. Dampening the overall results was beef. Beef? Yes, your mother's chicken company gets a third of its revenue from chicken and 44% from beef.

Expected to take a bite out of Tyson's results, mad cow disease did just that. Beef volume sales declined 12%. But get this: Revenue was down only 3%. A couple of mad cows apparently didn't drive down beef prices, but the 40% decrease in international beef sales at Tyson was no laughing matter.

The second quarter is usually the hardest for Tyson. To make matters worse, last year's second quarter had a $94 million gain from a one-time settlement of vitamin antitrust litigation. But results still improved year over year, bolstered by a $90 million gain from grain hedging. The company has talked about "taking prudent steps" by expanding its hedging operations, so give it credit for delivering the goods.

Tyson also hit another major milestone. After buying IBP (where all the beef came from), the company took on significant debt. To soothe investors, management set a 45% debt-to-capital target for the end of fiscal 2004. The company has reached that milestone -- two quarters ahead of plan.

Management also set earnings for the year at $1.05 to $1.25 a share, up sharply from last year's $0.80 a share, which explains why the stock is up 100% over the last 52 weeks. Yet, with a forward price-to-earnings ratio as low as 15 times, Tyson doesn't appear overpriced.

If you want to take a look at Tyson, you'll find that the company does an excellent job of presenting its business results -- including the risks. With cash up and debt down, the most commonly watched balance-sheets items are excellent. But note, too, that accounts receivable and inventories were down. When you consider that sales were up, that's excellent.

As for its peers, Tyson's operating margins better those of rival Smithfield Foods (NYSE:SFD). Pilgrim's Pride (NYSE:PPC) reported fantastic earnings today, which were covered by Seth Jayson. Former Motley Fool Stock Advisor pick Sanderson Farms (NASDAQ:SAFM) offers higher margins and a lower price-to-earnings ratio, but lacks the diversity of products that provides long-term protection for investors.

Investors considering food stocks or the food processors might just want to take a look at Tyson.

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Fool contributor W.D. Crotty does not own stock in any of the companies mentioned.