Summary

  • US Foods reported net sales of US$9.013 billion in Q2 2023, an increase of 2.1% over the previous corresponding period.
  • Brokers Trust Securities and BTIG raised their price targets on the stock, with the consensus mean price target on the stock being US$50.18.
  • Among the fourteen analysts that have covered the stock on EODHD/Others, four have given it a ‘strong buy’ rating and seven have given it a ‘buy’ rating.

U.S Foods Holding received an increased price target from brokers as it released its financial results for Q2 2023. The company saw a 2.1% increase in net sales during the quarter and saw a 15% increase in its gross profit for the quarter.

The company released its Q2 results on August 10, 2023. On the same day, brokers reviewed their ratings on USFD, while upgrading their price target on the stock. USFD has a mean consensus price target of US$50.18, which is 21.97% higher than the stock’s closing price on Friday.

Meanwhile, USFD has a mean recommendation rating of 1.9 on a scale of one to five. Here, one represents a ‘strong buy’ rating and five represents a ‘strong sell' rating.

As per EODHD/Others, fourteen analysts have covered the stock. Four analysts have given the stock a ‘strong buy’ rating and seven analysts have given it a ‘buy’ rating. Meanwhile, three analysts believe USFD is a ‘hold’ and none of the analysts have given the stock a ‘sell’ or ‘strong sell’ rating.

A closer look at US Foods’ financials

The food service distributor behind Sysco reported net sales of US$9.013 billion in Q2 2023, as against US$8.827 billion in Q2 2022. The company’s gross profit for Q2 2023 was US$1.59 billion and its operating income for the quarter was US$322 million.

Additionally, the company reported net income to common stockholders of US$182 million in Q2 2023. US Foods’ adjusted EBITDA increased 17.4% to US$432 million during the quarter.

The company’s adjusted EPS for Q2 2023 was 79 cents per share, higher than the average estimate of 76 cents per share, as per EODHD/Others. US Foods raised its fiscal 2023 adjusted EBITDA forecast to a range of US$1.51 billion to US$1.54 billion.

Trust Securities and BTIG raise price target on USFD

EODHD/Others reports that Trust Securities believes USFD is expected to witness stronger organic growth than pre-COVID. As per the broker, US Foods would benefit from market share gains, growth in cash and carry business and lesser exits in healthcare, hospitality, and chain segments.

Broker BTIG maintained its ‘buy’ rating on the stock, while raising its price target to US$52, an upside potential of 26.4% over Friday’s closing price. The broker stated that investors should focus on US Foods’ gross profit and EBITDA margins, which returned to 2019 levels amid easing fuel and logistics costs.

Truist Securities increased its price target on USFD to US$50, which is 21.54% higher than USFD’s closing price on August 11, 2023.

USFD Price Chart; Image Source: USFD EODHD/Others

The stock closed at US$41.14 on August 11, 2023. USFD hit its 52-week high of US$44.52 on July 13, 2023.