Sysco Navigates Institutional Shifts and Muted Quarterly Revenue
Sysco reported matched quarterly earnings alongside softer revenue, as institutional investors adjusted positions and analysts set mixed price targets.
Institutional shareholders recently rebalanced their stakes in Sysco Corporation (NYSE:SYY). Pictet Asset Management Holding SA cut its holdings by 33.7% in the third quarter by selling 420,141 shares, leaving it with 825,482 shares valued at $64,355,000. Ethic Inc. also trimmed its position by 28.8% to 105,755 shares worth $8,245,000. Conversely, Vise Technologies Inc. expanded its stake by 367.2% during the third quarter, holding 101,610 shares. Overall, institutional investors and hedge funds control 83.41% of the company's outstanding stock.
Sysco posted its latest financial results on Tuesday, November 3rd. The company recorded earnings of $1.19 per share, matching consensus expectations, while quarterly revenue of $21.74 billion fell short of the projected $22.02 billion. Still, revenue marked a 2.8% increase compared to the same period in the prior year, when earnings per share stood at $1.15. The firm achieved a net margin of 2.12% and a return on equity of 79.24%. Local case volume rose 2.7% during fiscal the first quarter, while an ongoing operational transformation aims to generate $100 million in savings by fiscal 2027.
Corporate insiders also adjusted their stakes. Director Thomas Gerard Ondrof purchased 2,500 shares on Wednesday, November 4th, at an average price of $76.62 each, representing an investment of $191,550.00. That gave him direct ownership of 2,500 shares. On the selling side, Executive Vice President Ronald Phillips sold 7,350 shares on Friday, August 21st, at an average price of $83.61 to cover tax withholding liabilities under a pre-arranged Rule 10b5-1 trading plan.
Wall Street analysts have maintained an overall Moderate Buy consensus rating on Sysco, according to MarketBeat data, though price targets vary. Citigroup reduced its target price from $87.00 to $84.00 while keeping a neutral rating. JPMorgan Chase & Co. also lowered its price objective from $95.00 to $92.00, citing more cautious expectations. In contrast, UBS Group previously raised its price target from $90.00 to $95.00 with a buy rating, noting that execution remains steady despite early-quarter headwinds. Out of eighteen tracked analyst opinions, eleven rate Sysco as a Buy, six issue a Hold, and one rates the stock a Sell.
Investors are also monitoring Sysco's proposed $29.1 billion acquisition of Jetro Restaurant Depot, which remains subject to Federal Trade Commission regulatory review. For shareholders, Sysco distributed a quarterly dividend of $0.55 per share on Friday, October 23rd, to stockholders of record as of Friday, October 2nd, representing an annualized payout of $2.20 per share.