Stephens Inc. has raised its stock rating for Sanderson Farms Inc. to overweight from equal-weight/volatile and its Pilgrim's Pride Corp. rating to overweight from equal-weight, based in part on industry production cutbacks and an improved poultry price outlook.

In a note to investors, the investment banking firm said it raised its stock price target for Sanderson Farms to $50 from $48. Shares of Sanderson Farms were $44.47, up $1.96, in morning trading on the Nasdaq.

The analysts noted Sanderson is a low-cost producer that is gaining market share, adding that breast meat prices are expected to rise this summer, which would help cover higher grain costs.

In the case of Pilgrim's Pride, the Stephens raised its stock price target to $30 per share from $28, saying it believes earnings have bottomed out and noting the company has negotiated more liberal credit agreements with its banks. Shares of Pilgrim's Pride were $24.71, up 84 cents, in morning trading on the New York Stock Exchange.

Publicly announced production cuts have pared industry output by 1.7 percent to 1.8 percent, the analysts wrote, noting that two smaller producers may have also pulled back, according to industry sources.