SYSCO Corporation (SYY) Shares Up 8.4% on Surprisingly Good Earnings Report


Last year when a merger failed with US Foods, investors became a bit bearish of SYSCO Corporation (NYSE:SYY), but apparently the failed merger may have been the best thing that could have happened to the company. SYSCO today reported surprisingly good earnings numbers for their second quarter.

Earnings for Q2 came in at $0.48, beating Wall Street’s consensus of $0.41 per share, while revenues slightly missed those numbers expected by Zack’s Research, coming in at $12.154 billion compared to the expected $12.174 billion.

More importantly, numbers for the company year-over-year saw improvement, as sales grew 3%, while gross margin also saw improvements.

The stock is up 8.47% or $3.37 following the news, hitting $43.18 per share. About 13.07M shares traded hands or up 194.37% from the average. SYY has risen 3.94% since June 25, 2015 and is currently uptrending. It has outperformed the S&P500 by 11.65%.

From a total of 5 analysts covering Sysco Corporation (NYSE:SYY) stock, 1 rate it a “Buy”, 2 a “Sell”, and 2 a “Hold”. This means that 20% of the ratings are positive. The highest target price is $45 while the lowest target price is $29. The mean of all analyst targets is $37 which is -14.31% below today’s ($43.18) stock price. Sysco Corporation was the topic of 8 analyst reports since August 6, 2015 according to the firm StockzIntelligence Inc. Goldman Sachs initiated shares on December 15 with a “Sell” rating. Deutsche Bank maintained SYY stock in a recent report from August 26 with a “Hold” rating.

The institutional sentiment decreased to 0.74 in Q2 2015. It’s down 0.13, from 0.87 in 2015Q2. The ratio fall, as 69 funds sold all their SYSCO Corporation shares they owned while 375 reduced their positions. 74 funds bought stakes while 256 increased their total positions. Institutions now own 426.84 million shares which is 5.55% less than the previous share count of 451.93 million in 2015Q2.

Trian Fund Management L.P. holds 13.78% of its total portfolio in SYSCO Corporation, equating to 41.41 million shares. Shayne & Co. Llc owns 390,731 shares representing 13.04% of their total US portfolio. Moreover, Tyvor Capital Llc has 9.1% of their total portfolio invested in the company, equating to 705,486 shares. The Texas-based Yacktman Asset Management Lp has a total of 6.6% of their portfolio invested in the stock. Fidelity National Financial Inc., a Florida-based fund reported 481,045 shares owned.

Since October 16, 2015, the stock had 0 insider purchases, and 1 insider sale for a total of $1.02 million in net activity. Delaney William J Iii sold 25,001 shares worth $1.02 million.

Sysco Corporation along with its subsidiaries and divisions, is a North American distributor of food and related products primarily to the foodservice or food-away-from-home industry. The company has a market cap of $22.46 billion. The Firm provides products and related services to approximately 425,000 customers, including restaurants, healthcare and educational facilities, lodging establishments and other foodservice customers. It has 39.64 P/E ratio. Sysco provides food and related products to the foodservice or food-away-from-home industry.