United Natural Foods Faces Long-term Structural Challenges; Analyst Sees Competition, FCF Pressure, Labor Issues
Portfolio Pulse from Nabaparna Bhattacharya
BMO Capital Markets analyst Kelly Bania reiterated a Market Perform on United Natural Foods, Inc. (UNFI), lowering the price target to $13 from $20. UNFI reported Q4 FY23 sales growth of 2% YoY to $7.417 billion, missing the analyst consensus. Bania sees long-term structural headwinds for UNFI, particularly as the grocery environment becomes more competitive and the company's investments in automation weigh on FCF. The analyst also sees a risk that cross-selling wins were aided by supply chain disruptions, and management visibility remains low.
September 27, 2023 | 6:05 pm
News sentiment analysis
Sort by:
Ascending
NEGATIVE IMPACT
UNFI faces long-term structural challenges, including a competitive grocery environment and investments in automation that could weigh on FCF. The lowered price target by BMO analyst could negatively impact the stock.
The lowered price target by BMO analyst indicates a bearish outlook for UNFI. The company's long-term structural challenges, including a competitive grocery environment and investments in automation, could negatively impact its financial performance and thus its stock price.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100