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Category: Stock Market and United Natural Foods
Date: 1 October 2019 Stock Price: $11.52 We take a look at the 3rd quarter earnings report of their 2019 fiscal year of United Natural Foods a premier food wholesaler delivering a wide variety of products to customers across North America
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About United Natural Foods
UNFI is North America's premier food wholesaler delivering the widest variety of products to customer locations throughout North America including natural product superstores, independent retailers, conventional supermarket chains, ecommerce retailers, and food service customers. By providing this deeper 'full-store' selection and compelling brands for every aisle, UNFI is uniquely positioned to deliver great food, more choices, and fresh thinking to customers everywhere. Combined with SUPERVALU, UNFI is the largest publicly-traded grocery distributor in America with expected annual sales of over $21 billion.
The image below shows some of United Natural Foods customer base. Kroger who we valued a few weeks ago is also one of them
The image below shows some of United Natural Foods customer base. Kroger who we valued a few weeks ago is also one of them
Overview of United Natural Foods' latest earnings report
- Net sales: $5.962 billion (up from $2.648 billion for the same quarter of the previous year
- Revenue increased by 125% over the last 12 months
- Cost of sales: $5.174 billion (up from $2.240 million for the same quarter of the previous year)
- Cost of sales increased by 130.9% over the last 12 months
- Net income: $57.092 million (up from $51.891 million for the same quarter of the previous year)
- Diluted earnings per share: $1.12 (up from $1.02 for the same quarter of the previous year)
- Diluted weighted-average shares outstanding: 50.964 million (up from 50.751 million for the same quarter of the previous year)
- Cash and cash equivalents: $37.861 million
- Cash and cash equivalents per share: $0.74
- Cash and cash equivalents makes up 6.44% of United Natural Foods' market capital
- Cash and cash equivalents makes up 0.51% of United Natural Foods' total assets
- Accounts receivable: $1.049 billion
- Accounts receivable makes up 14.32% of United Natural Foods' total assets
- Inventories: $2.214 billion
- Inventories makes up 30.21% of United Natural Foods' total assets
- Cash provided by operating activities for the 3 quarters of fiscal 2019: $77.190 million
- Cash provided by operating activities per share for the 3 quarters of fiscal 2019: $1.51
United Natural Foods' management commentary on the results and earnings guidance
PROVIDENCE, R.I., June 5, 2019 /PRNewswire/ -- United Natural Foods, Inc. (NYSE: UNFI) (the "Company" or "UNFI") today reported financial results for the third quarter of fiscal 2019 ended April 27, 2019.
"Our transformational journey continues, and I'm proud of what our team has accomplished this quarter," said Steven L. Spinner, Chairman and Chief Executive Officer. "I am excited about our next chapter and the acceleration of value creation we expect to realize from the scale, services, and assortment that only UNFI can deliver."
Fiscal 2019 Guidance
UNFI is updating fiscal 2019 Earnings Per Share guidance to a range of $(5.85) to $(5.65). This reflects the $38.3 million benefit from the goodwill impairment charge adjustment; $10 million in expected higher restructuring, acquisition, and integration related expenses; and adjusted EBITDA tracking closer to the low end of the range provided on March 5, 2019.
- Net Sales Increased to $5.96 Billion, Including $3.24 Billion from SUPERVALU
- Earnings Per Diluted Share (EPS) of $1.12; Adjusted EPS of $0.61
- Integration of SUPERVALU Progressing; UNFI Now Operating As One Company with A National Leadership Team and Structure
"Our transformational journey continues, and I'm proud of what our team has accomplished this quarter," said Steven L. Spinner, Chairman and Chief Executive Officer. "I am excited about our next chapter and the acceleration of value creation we expect to realize from the scale, services, and assortment that only UNFI can deliver."
Fiscal 2019 Guidance
UNFI is updating fiscal 2019 Earnings Per Share guidance to a range of $(5.85) to $(5.65). This reflects the $38.3 million benefit from the goodwill impairment charge adjustment; $10 million in expected higher restructuring, acquisition, and integration related expenses; and adjusted EBITDA tracking closer to the low end of the range provided on March 5, 2019.
United Natural Foods (NYSE: UNFI) stock price history
The image below, obtained from Google, shows the stock price history of United Natural Foods (NYSE:UNFI) over the last 5 years. And it's been a horrible time for United Natural Foods stockholders. 5 years ago the stock was trading at around $61 and it is currently trading at $11.52 a stock. So over a 5 year period the stock of United Natural Foods declined by -81.1% . The stock is also trading at closer to its 52 week low of $6.75 than it is to its 52 week high of $30.30, which to us is a clear indication that the short term sentiment and momentum towards United Natural Foods' stock is very negative.
United Natural Foods (NYSE: UNFI) latest stock valuation
So what is United Natural Foods (NYSE: UNFI) stock worth based on the release of their latest earnings report? Based on their earnings report and the fiscal guidance provided our valuation models provide a target (full value) price for United Natural Foods of $32.10 a stock. We therefore believe that the stock is undervalued.
We usually suggest long term investors look to enter a stock at least 10% below our target (full value) price which in this case is $32.10. A good entry point into United Natural Foods stock would be at $28.90 or below. Since the stock is trading at well below these levels we rate the stock of United Natural Foods as a buy.
We usually suggest long term investors look to enter a stock at least 10% below our target (full value) price which in this case is $32.10. A good entry point into United Natural Foods stock would be at $28.90 or below. Since the stock is trading at well below these levels we rate the stock of United Natural Foods as a buy.