News of the protein glut is hardly new anymore -- after all, we've seen its effects in the results of companies like Tyson (NYSE:TSN) and Pilgrim's Pride (NYSE:PPC). All the same, while Smithfield (NYSE:SFD) may not be doing quite as well as rival pork producer Hormel (NYSE:HRL), this integrated player is still doing relatively better than many other protein players.

While revenue was down 5% for the company's first quarter, operating profits fell 11% and trailing 12-month EBITDA was down about 17% from last year's levels. I know that doesn't sound particularly good, but it's better than Tyson and the poultry posse. Simply put, end-user pricing just wasn't that strong and costs continue to rise.

Smithfield's performance was once again mixed across the categories. Pork revenue was down, but operating income was up sharply, in part because of a mark-to-market hedging gain. Underlying that was flat volume in processed meats and lower volume in fresh pork. Some processed categories like spiral ham and sausage continue to do well, though, and that's where both Smithfield and Hormel are doing pretty well. Elsewhere, beef was weak and the hog business was hurt by higher raising costs and an impairment charge.

Management here is not about to let a tough near term lead it to forget about the long term. To that end, it has purchased Sara Lee's (NYSE:SLE) European meats business and recently acquired the ConAgra (NYSE:CAG) processed meats business at what looks like a bargain price. While ConAgra's meat business features old brands and old facilities, the price suggests some real long-term potential from the deal.

To be honest, Smithfield flummoxes me. The stock has been a real trouper over the years -- easily outdistancing Hormel and Tyson. And yet the legacy of returns on invested capital is not all that great. Proof, perhaps, that even this methodology isn't flawless. All that said, I suppose the company has earned the benefit of the doubt, but approach with caution.

For more Foolish food for thought:

Sara Lee used to be an Income Investor selection.

Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).