Traders Buy Shares of SYSCO (SYY) on Weakness Following Weak Earnings

Investors bought shares of SYSCO Co. (NYSE:SYY) on weakness during trading on Tuesday following a dissappointing earnings announcement. $68.20 million flowed into the stock on the tick-up and $38.23 million flowed out of the stock on the tick-down, for a money net flow of $29.97 million into the stock. Of all equities tracked, SYSCO had the 19th highest net in-flow for the day. SYSCO traded down ($0.11) for the day and closed at $64.45The company reported $0.91 EPS for the quarter, missing the Thomson Reuters’ consensus estimate of $0.92 by ($0.01). SYSCO had a return on equity of 68.15% and a net margin of 2.44%. The company had revenue of $15.22 billion during the quarter, compared to analysts’ expectations of $15.39 billion. During the same quarter in the prior year, the company posted $0.74 EPS. The company’s revenue for the quarter was up 3.9% on a year-over-year basis.

Several research firms have commented on SYY. Loop Capital lowered their price objective on SYSCO to $75.00 and set a “buy” rating on the stock in a research report on Tuesday. They noted that the move was a valuation call. BMO Capital Markets set a $79.00 price objective on SYSCO and gave the stock a “buy” rating in a research report on Tuesday. Credit Suisse Group set a $75.00 price objective on SYSCO and gave the stock a “buy” rating in a research report on Tuesday. ValuEngine lowered SYSCO from a “buy” rating to a “hold” rating in a research report on Tuesday. Finally, Morgan Stanley set a $69.00 price objective on SYSCO and gave the stock a “hold” rating in a research report on Tuesday. One investment analyst has rated the stock with a sell rating, six have issued a hold rating and six have assigned a buy rating to the company. The stock currently has a consensus rating of “Hold” and a consensus price target of $73.15.

In other news, Director Richard G. Tilghman sold 5,000 shares of the stock in a transaction that occurred on Monday, October 15th. The stock was sold at an average price of $68.62, for a total transaction of $343,100.00. Following the transaction, the director now owns 56,393 shares in the company, valued at approximately $3,869,687.66. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this link. Also, Director Trian Fund Management, L.P. sold 2,115,358 shares of the stock in a transaction that occurred on Wednesday, September 12th. The shares were sold at an average price of $74.81, for a total value of $158,249,931.98. Following the transaction, the director now owns 4,005 shares in the company, valued at approximately $299,614.05. The disclosure for this sale can be found here. Insiders have sold a total of 3,969,811 shares of company stock worth $297,370,093 in the last quarter. Insiders own 7.88% of the company’s stock.

Several large investors have recently made changes to their positions in SYY. Bank of America Corp DE lifted its holdings in SYSCO by 64.6% in the 2nd quarter. Bank of America Corp DE now owns 17,662,742 shares of the company’s stock valued at $1,206,188,000 after purchasing an additional 6,929,805 shares in the last quarter. Janus Henderson Group PLC lifted its holdings in SYSCO by 1.2% in the 2nd quarter. Janus Henderson Group PLC now owns 5,903,214 shares of the company’s stock valued at $403,131,000 after purchasing an additional 68,148 shares in the last quarter. Bank of Montreal Can lifted its holdings in SYSCO by 14.9% in the 2nd quarter. Bank of Montreal Can now owns 4,552,341 shares of the company’s stock valued at $310,878,000 after purchasing an additional 590,410 shares in the last quarter. Victory Capital Management Inc. lifted its holdings in SYSCO by 2.1% in the 2nd quarter. Victory Capital Management Inc. now owns 4,131,297 shares of the company’s stock valued at $282,126,000 after purchasing an additional 86,450 shares in the last quarter. Finally, Morgan Stanley lifted its holdings in SYSCO by 83.0% in the 2nd quarter. Morgan Stanley now owns 3,896,733 shares of the company’s stock valued at $266,109,000 after purchasing an additional 1,767,298 shares in the last quarter. Hedge funds and other institutional investors own 80.11% of the company’s stock.

The company has a quick ratio of 0.74, a current ratio of 1.21 and a debt-to-equity ratio of 3.01. The firm has a market cap of $37.12 billion, a price-to-earnings ratio of 20.53, a price-to-earnings-growth ratio of 1.93 and a beta of 0.56.

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SYSCO Company Profile (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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