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Argus Has A Taste For United Natural Foods, Names The Stock A Buy

Argus Has A Taste For United Natural Foods, Names The Stock A Buy

Analysts at Argus Research Company turned bullish on United Natural Foods, Inc. (NASDAQ: UNFI) after the company "strengthened" its balance sheet and offered investors "solid" guidance for the full-year in its fourth-quarter earnings report. The firm's David Coleman upgrades United Natural Foods' stock from Hold to Buy with a $49 price target.

United Natural Foods guided its full year fiscal 2018 revenue to be higher by 3.8 to 5.8 percent, or $9.63 to $9.81 billion, the analyst highlighted in his upgrade note. The earnings report also demonstrated management's commitment to improving its balance sheet while not shying away from accretive M&A deals.

Throughout fiscal 2017 the company oversaw four acquisitions and even more deals are "expected" in fiscal 2018, Coleman noted.


However, there is likely to be some pressure to United Natural Foods' earnings as the company places more of an emphasis of fresh food as opposed nonperishable items. The company has also been active in investing in cold-storage facilities and distribution centers which prompted the analyst to lower his fiscal 2018 earnings per share estimate from $2.80 to $2.74. Nevertheless, the revised estimate remains above the consensus estimate of $2.70 per share and the company is still expected to generate a long-term earnings growth rate of 15 percent.

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United Natural Foods: Big Upside On Positive Earnings

Latest Ratings for UNFI

Jan 2020DowngradesEqual-WeightUnderweight
Dec 2019MaintainsNeutral
Oct 2019MaintainsMarket Perform

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