UPDATE: Deutsche Bank Reiterates On The Chefs' Warehouse Following 2Q EPS Misses

In a report published Friday, Deutsche Bank analyst Greg Poole reiterated a Hold rating on

, but lowered the price target from $23.00 to $17.00. In the report, Deutsche Bank noted, “CHEF reported adj. EPS of $0.18 that was below our $0.23 estimate and $0.21 Consensus. The miss was driven by lower gross margins and higher operating expenses as CHEF reported impressive revenue growth – organic growth increased +4.6% overall and was 10%+ in the southern and western regions. Gross margins were hurt by negative mix shift at Allen Bros. and the inability to pass on high levels of inflation (+5.4%), and operating expenses were pressured by investments made to support future growth. "CHEF is building the infrastructure to support a company that generates $1+ billion in revenues. In the near-term, until CHEF approaches that size, CHEF will probably generate limited flow-through despite the company's impressive top line growth. Unfortunately, there is limited visibility as to when CHEF will achieve $1 billion in sales – it could be FY15 with the right acquisitions, but acquisitions are impossible to predict. As a result, we remain at Hold.” The Chefs' Warehouse closed on Thursday at $17.57.