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Category: Stock Market and Sysco Corporation
Date: 16 September 2019 Stock Price: $77.49 We take a look at the 4th quarter earnings release of their 2019 fiscal year of food marketing and distribution firm, Sysco Corporation, whose turnover for the fiscal year 2019 topped $61 billion.
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About Sysco Corporation
Sysco is the global leader in selling, marketing and distributing food products to restaurants, healthcare and educational facilities, lodging establishments and other customers who prepare meals away from home. Its family of products also includes equipment and supplies for the foodservice and hospitality industries.
Overview of Sysco Corporation's latest earnings report
The numbers we are interested in (for the quarter):
- Total revenue: $15.474 billion (up from $15.315 billion from the same quarter of the previous year)
- Revenues increased by 1.03% over the last 12 months
- Cost of Revenues: $12.495 billion (up from $12.399 billion for the same quarter of the previous year)
- Cost of revenues increased by 0.77% over the last 12 months
- Net income: $535.766 million (up from $448.928 million for the same quarter of the previous year)
- Diluted earnings per share: $1.03 (up from $0.85 for the same quarter of the previous year)
- Diluted weighted-average shares outstanding: 520.060 million (down from 528.053 million for the same quarter of the previous year)
- Cash and cash equivalents: $513.460 million
- Cash and cash equivalents per share: $0.98
- Cash and cash equivalents makes up 1.27% of Sysco Corporation market capital
- Cash and cash equivalents makes up 2.86% of Sysco Corporation's total assets
- Receivables: $4.181 billion
- Receivables makes up 23.27% of Sysco Corporation's total assets
- Inventories: $3.216 billion
- Inventories makes up 17.9% of Sysco Corporation's total assets
- Stockholders equity: $2.502 billion
- Stockholders equity per share: $4.80
- Sysco is trading at 16.1 times its stockholders equity. This number is very high as firms tend to trade at between 2 to 5 times their stockholders equity per share.
- Cash generated from operations for the fiscal year: $2.411 billion
- Cash generated from operations per share: $4.63
Sysco Corporation's management commentary on the results and earnings guidance
HOUSTON, August 12, 2019 - Sysco Corporation (NYSE: SYY) today announced financial results for its 13-week fourth fiscal quarter and its fiscal year ended June 29, 2019.
“Sysco saw improved year-over-year performance in the fourth quarter and fiscal year 2019,” said Tom Bené, Sysco’s chairman, president and chief executive officer. “We continue to focus on our customers and are furthering the progress of our transformative initiatives, which we believe will increase the ease of doing business with Sysco, position us well for the long-term and create value for our shareholders in fiscal year 2020 and beyond.”
Fiscal 2019 Highlights
• Sales increased 2.4% to $60.1 billion
• Gross profit increased 2.9% to $11.4 billion; gross margin increased 10 basis points
• Operating income increased 0.7% to $2.3 billion; adjusted¹ operating income increased 7.9% to $2.7 billion
• EPS increased $0.50 to $3.20; adjusted¹ EPS increased $0.41 to $3.55
“Sysco saw improved year-over-year performance in the fourth quarter and fiscal year 2019,” said Tom Bené, Sysco’s chairman, president and chief executive officer. “We continue to focus on our customers and are furthering the progress of our transformative initiatives, which we believe will increase the ease of doing business with Sysco, position us well for the long-term and create value for our shareholders in fiscal year 2020 and beyond.”
Fiscal 2019 Highlights
• Sales increased 2.4% to $60.1 billion
• Gross profit increased 2.9% to $11.4 billion; gross margin increased 10 basis points
• Operating income increased 0.7% to $2.3 billion; adjusted¹ operating income increased 7.9% to $2.7 billion
• EPS increased $0.50 to $3.20; adjusted¹ EPS increased $0.41 to $3.55
Sysco Corporation (NYSE: SYY) stock price history
The image below, obtained from Google, shows the stock price history of Sysco Corporation (NYSE: SYY) for the last 5 years. And its been a very good time for Sysco Corporation stockholders. 5 years ago the stock was trading at around $38 and its currently trading at $77.50. That's a very strong return of 103.9% return provided to Sysco Corporation investors over the last 5 years. The stock is trading at very close to its 52 week of $78.45 and a long long way away from its 52 week low of $59.44 which is a clear indication that short term momentum and sentiment towards Sysco Corporation is very positive.
Recent coverage of Sysco Corporation
The extract below shows recent coverage of Sysco Corporation as obtained from Zacks
Sysco Corporation (SYY - Free Report) touched a 52-week high of $78.40, before closing the session slightly lower at $78.28 on Sep 13. Shares of this Houston, TX-based company have rallied approximately 18% in past six months, outperforming the industry’s growth of 11.3%. This Zacks Rank #3 (Hold) stock has also comfortably outperformed the Consumer Staples sector and the S&P 500 Index that advanced 6.7% and 4.8%, respectively, in the said time frame. With a long-term earnings growth rate of 9.5% and a VGM score of B, Sysco is positioned to attain new highs.
Read the full article here
Sysco Corporation (SYY - Free Report) touched a 52-week high of $78.40, before closing the session slightly lower at $78.28 on Sep 13. Shares of this Houston, TX-based company have rallied approximately 18% in past six months, outperforming the industry’s growth of 11.3%. This Zacks Rank #3 (Hold) stock has also comfortably outperformed the Consumer Staples sector and the S&P 500 Index that advanced 6.7% and 4.8%, respectively, in the said time frame. With a long-term earnings growth rate of 9.5% and a VGM score of B, Sysco is positioned to attain new highs.
Read the full article here
Sysco Corporation (NYSE: SYY) latest stock valuation
So based on the earnings report of Sysco Corporation (NYSE: SYY) and what do we value Sysco (SYY) stock at? Based on the earnings reported our valuation model provides a target (full value) price for Sysco (SSY) at $80.90 a stock. We therefore believe that Sysco Corporation is very close to full value. We would not recommend investors buy into Sysco at its current price, but we suggest investors look to enter the stock at least 10% below our target (full value) price of $80.90. A good entry would therefore be at around $72.80 a Sysco Corporation stock.