Published On: Thu, Sep 15th, 2016

United Natural Foods Inc. (UNFI) Downgraded to “Sell” at Zacks Investment Research

United Natural Foods Inc. (NASDAQ:UNFI) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a report released on Thursday.
According to Zacks, “United Natural posted better-than-expected fourth quarter fiscal 2016 results, but remains cautious due to industry-wide weakness and declining gross margin. While net sales increased 7.4% year over year, driven by acquisitions, earnings of $0.70 per share declined 2.8% in the fourth quarter due to operating income margins. Gross margin expanded in the quarter, but continued to remain challenging due to competitive pricing pressure, moderated supplier promotional activity, and a reduction in fuel surcharges. Overall, we are impressed with the company’s focus on its acquisition strategies, efforts to increase its market share and improve operational efficiency. However, gross margin headwinds continue to remain a concern. Further, the company will face the pressure from food deflation, stiff competition, aggressive promotional environment and waning store traffic.”
Several other research firms have also recently commented on UNFI. BMO Capital Markets set a $45.00 target price on shares of United Natural Foods and gave the company a “hold” rating in a research note on Tuesday. Deutsche Bank AG reissued a “hold” rating on shares of United Natural Foods in a research note on Saturday, June 4th. Morgan Stanley set a $36.00 price objective on shares of United Natural Foods and gave the stock a “sell” rating in a research note on Tuesday. Royal Bank Of Canada lifted their price objective on shares of United Natural Foods from $33.00 to $34.00 and gave the stock a “sector perform” rating in a research note on Wednesday. Finally, TheStreet raised shares of United Natural Foods from a “hold” rating to a “buy” rating in a research note on Friday, July 22nd. Six analysts have rated the stock with a sell rating, thirteen have assigned a hold rating and five have given a buy rating to the company. The company has an average rating of “Hold” and an average price target of $44.48.

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Shares of United Natural Foods (NASDAQ:UNFI) opened at 39.54 on Thursday. United Natural Foods has a 12-month low of $29.75 and a 12-month high of $55.69. The stock has a market cap of $1.99 billion, a P/E ratio of 15.63 and a beta of 1.03. The company’s 50-day moving average is $48.39 and its 200-day moving average is $41.76.
United Natural Foods (NASDAQ:UNFI) last released its quarterly earnings data on Monday, September 12th. The company reported $0.70 earnings per share for the quarter, topping the Zacks’ consensus estimate of $0.63 by $0.07. United Natural Foods had a net margin of 1.48% and a return on equity of 8.85%. The business had revenue of $2.21 billion for the quarter. During the same period last year, the business earned $0.72 EPS. The firm’s revenue was up 7.4% on a year-over-year basis. On average, analysts expect that United Natural Foods will post $2.51 earnings per share for the current fiscal year.
Hedge funds have recently bought and sold shares of the stock. JPMorgan Chase & Co. boosted its stake in United Natural Foods by 117.5% in the second quarter. JPMorgan Chase & Co. now owns 2,553 shares of the company’s stock worth $119,000 after buying an additional 1,379 shares during the period. Acrospire Investment Management LLC boosted its stake in United Natural Foods by 575.0% in the second quarter. Acrospire Investment Management LLC now owns 2,700 shares of the company’s stock worth $126,000 after buying an additional 2,300 shares during the period. LS Investment Advisors LLC boosted its stake in United Natural Foods by 75.9% in the second quarter. LS Investment Advisors LLC now owns 3,062 shares of the company’s stock worth $143,000 after buying an additional 1,321 shares during the period. Advisor Group Inc. acquired a new stake in United Natural Foods during the second quarter worth about $149,000. Finally, AGF Investments Inc. boosted its stake in United Natural Foods by 4.4% in the second quarter. AGF Investments Inc. now owns 3,768 shares of the company’s stock worth $176,000 after buying an additional 160 shares during the period. Hedge funds and other institutional investors own 98.13% of the company’s stock.
About United Natural Foods
United Natural Foods, Inc is a distributor of natural, organic and specialty foods and non-food products in the United States and Canada. It offers products, in six product categories: grocery and general merchandise, produce, perishables and frozen foods, nutritional supplements and sports nutrition, bulk and food service products and personal care items.
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