Kelly Bania, an analyst from BMO Capital, reiterated the Buy rating on US Foods Holding (USFD – Research Report). The associated price target was raised to $62.00.
Kelly Bania has given his Buy rating due to a combination of factors that suggest a strong performance and potential for growth for US Foods Holding (USFD). Despite facing industry-wide challenges, USFD demonstrated a solid first quarter in 2024, which was buoyed by a series of successful initiatives and strategic moves. These include securing new customer contracts in the Hospitality sector, benefiting from modest mergers and acquisitions that exceeded forecasts, and achieving significant organic growth with Independent customers. Bania’s confidence is further bolstered by USFD’s ability to maintain its revenue outlook, which stands out compared to its peers.
The analyst’s optimism is also rooted in USFD’s transparency regarding its cost-saving initiatives and operational efficiencies. The company has reported substantial savings in cost of goods sold (COGS), which have been a key driver of EBITDA growth. Additionally, innovative programs such as the Pronto urban service model and replenishment initiatives contribute to operational savings and sales growth. These factors, combined with detailed disclosures that provide a clearer understanding of the company’s financial health, lead Bania to believe that USFD is well-positioned for continued momentum. Consequently, Bania has raised the target price to $62, supported by a valuation slightly above USFD’s historical average.
In another report released today, Piper Sandler also maintained a Buy rating on the stock with a $59.00 price target.
Based on the recent corporate insider activity of 53 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of USFD in relation to earlier this year.
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US Foods Holding (USFD) Company Description:
US Foods Holding Corp. operates as a foodservice distributor. Its products include frozen and dry food and non-food products to foodservice customers throughout the U.S. The company offers services under brands Chef’s Line, del Pasado, Glenview Farms, Cattleman’s Selection, Cross Valley Farms, Harbor Banks, Hilltop Hearth, Devonshire, and Metro Deli. The company is headquartered in Rosemont, IL.
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