Traders Buy SYSCO (SYY) on Weakness After Earnings Miss

Traders purchased shares of SYSCO Co. (NYSE:SYY) on weakness during trading on Monday following a weaker than expected earnings announcement. $179.17 million flowed into the stock on the tick-up and $135.43 million flowed out of the stock on the tick-down, for a money net flow of $43.74 million into the stock. Of all companies tracked, SYSCO had the 10th highest net in-flow for the day. SYSCO traded down ($6.73) for the day and closed at $64.56The company reported $0.91 earnings per share for the quarter, missing the consensus estimate of $0.92 by ($0.01). The firm had revenue of $15.22 billion for the quarter, compared to analysts’ expectations of $15.39 billion. SYSCO had a net margin of 2.44% and a return on equity of 68.15%. SYSCO’s revenue for the quarter was up 3.9% compared to the same quarter last year. During the same period last year, the firm earned $0.74 earnings per share.

SYY has been the subject of several recent research reports. Morgan Stanley lifted their target price on shares of SYSCO from $61.00 to $67.00 and gave the company an “equal weight” rating in a report on Tuesday, July 17th. Wells Fargo & Co lifted their target price on shares of SYSCO from $71.00 to $80.00 and gave the company a “$70.32” rating in a report on Wednesday, July 18th. They noted that the move was a valuation call. Zacks Investment Research lowered shares of SYSCO from a “hold” rating to a “sell” rating in a report on Monday, July 23rd. ValuEngine lowered shares of SYSCO from a “buy” rating to a “hold” rating in a report on Thursday, August 2nd. Finally, Pivotal Research lowered shares of SYSCO from a “hold” rating to a “sell” rating and set a $58.00 target price for the company. in a report on Friday, August 10th. One research analyst has rated the stock with a sell rating, five have assigned a hold rating and seven have assigned a buy rating to the company. The company presently has an average rating of “Hold” and a consensus target price of $73.62.

In related news, Director Richard G. Tilghman sold 5,000 shares of the business’s stock in a transaction on Monday, October 15th. The shares were sold at an average price of $68.62, for a total value of $343,100.00. Following the completion of the sale, the director now owns 56,393 shares of the company’s stock, valued at approximately $3,869,687.66. The sale was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, SVP Brian R. Todd sold 9,147 shares of the business’s stock in a transaction on Wednesday, August 15th. The stock was sold at an average price of $73.82, for a total transaction of $675,231.54. Following the completion of the sale, the senior vice president now directly owns 11,747 shares of the company’s stock, valued at approximately $867,163.54. The disclosure for this sale can be found here. In the last three months, insiders sold 3,969,811 shares of company stock valued at $297,370,093. 7.88% of the stock is owned by insiders.

Hedge funds and other institutional investors have recently modified their holdings of the stock. MUFG Securities EMEA plc purchased a new stake in shares of SYSCO during the second quarter worth $14,719,000. Homrich & Berg grew its holdings in shares of SYSCO by 12.7% during the second quarter. Homrich & Berg now owns 13,659 shares of the company’s stock worth $933,000 after buying an additional 1,538 shares in the last quarter. Spears Abacus Advisors LLC purchased a new stake in shares of SYSCO during the second quarter worth $212,000. NumerixS Investment Technologies Inc purchased a new stake in shares of SYSCO during the second quarter worth $1,008,000. Finally, Golub Group LLC grew its holdings in shares of SYSCO by 4.6% during the second quarter. Golub Group LLC now owns 34,278 shares of the company’s stock worth $2,341,000 after buying an additional 1,512 shares in the last quarter. 80.11% of the stock is owned by institutional investors.

The firm has a market capitalization of $37.12 billion, a PE ratio of 20.56, a price-to-earnings-growth ratio of 1.93 and a beta of 0.56. The company has a current ratio of 1.21, a quick ratio of 0.74 and a debt-to-equity ratio of 3.01.

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About SYSCO (NYSE:SYY)

Sysco Corporation, through its subsidiaries, markets and distributes a range of food and related products primarily to the foodservice or food-away-from-home industry. It operates through three segments: U.S. Foodservice Operations, International Foodservice Operations, and SYGMA. The company distributes a line of frozen foods, such as meats, seafood, fully prepared entrees, fruits, vegetables, and desserts; a line of canned and dry foods; fresh meats and seafood; dairy products; beverage products; imported specialties; and fresh produce.

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