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Sysco Corp SYY

Morningstar Rating
$76.96 −0.36 (0.47%)
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Company Report

Strong Results Support Sysco's Increased Share Buyback Without Sacrificing Reinvestment

Foodservice distribution is highly fragmented, with Sysco holding just 17% as the leader of the roughly $350 billion U.S. market. However, we think its dominance is far stronger than share alone may imply. Restaurants demand timely and consistent delivery to serve the freshest food. Sysco adds value by allowing restaurants to buy the bulk of its needs from a single source rather than dozens of producers, simplifying logistics and saving time. While the goods it sells are commodities, Sysco can differentiate on selection, quality, and freshness while also offering services like menu planning and kitchen setup advice. Indeed, we believe this has driven top-line growth that has outpaced industry growth, which should persist, leading to our 4.5% average annual sales growth forecast.

Price vs Fair Value

SYY is trading at a 1% discount.
Price
$77.32
Fair Value
$67.00
Uncertainty
Medium
1-Star Price
$136.90
5-Star Price
$79.70
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Sysco’s dense distribution network allows it to deliver perishable goods more quickly and cost-effectively, and this edge should help it continue to take market share over time.

Bears

The lack of pricing power and switching costs among foodservice distributors leaves Sysco at risk for intense price competition.

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News

Trading Information

Previous Close Price
$77.32
Day Range
$76.8177.71
52-Week Range
$62.2482.55
Bid/Ask
$76.68 / $78.21
Market Cap
$38.31 Bil
Volume/Avg
2.1 Mil / 2.7 Mil

Key Statistics

Price/Earnings (Normalized)
18.33
Price/Sales
0.50
Dividend Yield (Trailing)
2.59%
Dividend Yield (Forward)
2.59%
Total Yield
3.79%

Company Profile

Sysco is the largest U.S. foodservice distributor with 17% share of the highly fragmented $350 billion domestic market. Sysco distributes roughly 500,000 food and nonfood products to restaurants (62% of fiscal 2023 revenue), education and government buildings (8%), travel and leisure (8%), healthcare facilities (7%) and other locations (15%) where individuals consume away-from-home meals. In fiscal 2023, 70% of the firm’s revenue was derived from its U.S. foodservice operations, while its international (18%), quick-service logistics (10%), and other (2%) segments made up the difference.
Sector
Consumer Defensive
Industry
Food Distribution
Stock Style Box
Mid Core
Total Number of Employees
72,000

Competitors

Valuation

Metric
SYY
CPG
Price/Earnings (Normalized)
18.3323.94
Price/Book Value
16.127.24
Price/Sales
0.501.22
Price/Cash Flow
12.0417.41
Price/Earnings
SYY
CPG

Financial Strength

Metric
SYY
CPG
Quick Ratio
0.760.65
Current Ratio
1.370.75
Interest Coverage
5.909.83
Quick Ratio
SYY
CPG

Profitability

Metric
SYY
CPG
Return on Assets (Normalized)
9.23%8.39%
Return on Equity (Normalized)
111.74%27.41%
Return on Invested Capital (Normalized)
18.53%15.99%
Return on Assets
SYY
CPG
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