Sysco Corporation, through its subsidiaries, engages in the sale, marketing, and distribution of food and related products to restaurants, healthcare and educational facilities, lodging establishments, and other foodservice customers. It operates through U.S. Foodservice Operations, International Foodservice Operations, SYGMA, and Other segments. The company distributes frozen food, such as meats, seafood, fully prepared entrées, fruits, vegetables, and desserts; canned and dry food; fresh meats and seafood; dairy and beverage products; imported specialties; and fresh produce. It also supplies paper products, including disposable napkins, plates, and cups; tableware comprising glassware and silverware; cookware consisting of pots, pans, and utensils; restaurant and kitchen equipment and supplies; and cleaning supplies. The company operates in the United States, Canada, the United Kingdom, France, Sweden, and internationally. Sysco Corporation was incorporated in 1969 and is headquartered in Houston, Texas.
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Trump's 90-Day Beef Tariff Waiver Boosts These ETFs
President Donald Trump announced a temporary 90-day waiver on out-of-quota tariffs for up to 300,000 metric tons of imported ground beef trimmings, aiming to ease domestic food prices. With the U.S. cattle herd at its lowest since 1951, domestic beef prices have hit record highs, straining restaurants and consumers. The waiver is expected to lower wholesale ground beef costs over the next three months, benefiting fast-food chains like McDonald's and Yum! Brands, as well as meat processors and distributors such as JBS, US Foods, and Sysco. Consequently, ETFs with significant exposure to these companies, including the State Street Consumer Discretionary Select Sector SPDR ETF (XLY), Invesco Leisure and Entertainment ETF (PEJ), and First Trust Consumer Staples AlphaDEX ETF (FXG), are poised to gain from improved profitability in the foodservice supply chain.
Sysco Corporation announced that its Board of Directors declared a quarterly cash dividend of $0.55 per share, payable on October 23, 2026, to common stockholders of record at the close of business on October 2, 2026. Sysco is the global leader in selling, marketing and distributing food and related products to customers who prepare meals away from home, operating 333 distribution centers in 10 countries with 75,000 colleagues serving approximately 670,000 customer locations. The company generated sales of more than $84 billion in fiscal year 2026 that ended June 27, 2026.
Sysco announced strategic governance and operating initiatives to accelerate its enterprise-wide AI transformation. Effective September 1, the company will add Jason Murray and Thomas Ondrof to its board, increasing it to 13 members. Murray, co-founder and CEO of Shipium and a former Amazon vice president, will join the Artificial Intelligence Transformation & Technology board committee, while Ondrof, former CFO of Aramark, will serve on the Audit Committee. Sysco also expanded the mandate of its former Technology Committee, renaming it the Artificial Intelligence Transformation & Technology Committee, which will meet monthly with management. The company reaffirmed fiscal 2027 guidance of 6% to 7% revenue growth and 9% to 11% adjusted EPS growth on a 53-week basis, including a $100 million cost-savings program driven by AI-enabled process improvements. Shares of Sysco rose 1.8% in late morning trading.
Jim Cramer Says Sysco's Solid Quarter Is Being Given Away for Free
Jim Cramer argued on Mad Money that investors are getting Sysco's solid quarter for free after the stock dipped 2.6% post-earnings before recovering. Sysco reported adjusted non-GAAP EPS of $1.53, up 3.4% year-over-year and beating consensus by $0.02, with total revenue of $22.1 billion, up 4.7% and $210 million above expectations. Management guided fiscal 2027 sales growth of 6% to 7% and adjusted EPS growth of 9% to 11%, citing about $100 million in AI-driven efficiency improvements. Cramer also highlighted the pending Jetro Restaurant Depot acquisition, which he said would give Sysco a hammer lock on the industry, though the deal adds debt and pauses buybacks.
Sysco Beats Q4 Expectations, Guides for 9-11% EPS Growth in Fiscal 2027
Sysco reported strong fourth-quarter results, with adjusted earnings per share of $1.53 and total revenue exceeding $22 billion, a growth rate of 4.7%. The company provided fiscal 2027 guidance calling for revenue growth of 6% to 7% to approximately $90 billion and adjusted EPS growth of 9% to 11%, equating to $5.02 to $5.12. Sysco also announced approximately $100 million in in-year cost savings from AI-driven efficiency initiatives, with a run rate of approximately $160 million. USFS local case volumes grew 2.6% in the quarter, and the International segment posted its 11th consecutive quarter of double-digit adjusted operating income growth, with local case growth of 4.5% and adjusted operating income growth of 15.7%. Free cash flow for the year rose 16.3% to $2.1 billion, while net debt leverage stood at 2.7 times at quarter end.
Food distribution giant Sysco will report its second-quarter earnings before the bell on Tuesday. The company met revenue expectations last quarter with $20.52 billion, up 4.7% year on year, but missed EBITDA estimates. For this quarter, analysts expect revenue growth of 3.8% year on year, and estimates have been largely reconfirmed over the last 30 days. Sysco has missed Wall Street revenue estimates multiple times over the past two years, and its stock price was unchanged over the last month heading into earnings with an average analyst price target of $87.64 compared to the current share price of $84.52.
Zacks Highlights Four Food Stocks Amid Industry Headwinds
Zacks Equity Research has identified Mondelez International, Sysco, United Natural Foods, and Mama's Creations as stocks to watch within the Food-Miscellaneous industry, which faces pressure from value-conscious consumers and persistent cost inflation. The industry carries a Zacks Industry Rank of 214, placing it in the bottom 13% of more than 247 Zacks industries, and its consensus earnings estimate for the current financial year has declined 2.7% since the beginning of May 2026. United Natural Foods holds a Zacks Rank of 1, or Strong Buy, with shares gaining 109.4% over the past year, while Mama's Creations is ranked 2, or Buy, and has rallied 115.2%. Mondelez and Sysco both carry a Zacks Rank of 3, or Hold, with Mondelez shares down 10.4% and Sysco shares up 9.2% over the same period.
We are skeptical of three consumer stocks: Gray Television, Warner Music Group, and Sysco. Gray Television, with a market cap of $410.1 million, saw its sales grow at just 5.2% annually over five years, below the typical consumer discretionary company, and its return on invested capital has not improved, raising doubts about recent investments. Warner Music Group, valued at $15 billion, posted 8.6% annual revenue growth over five years, slower than peers, with free cash flow margin not expected to grow and eroding returns on capital from a low base. Sysco, with a market cap of $39.91 billion, achieved only 1.1% average unit sales growth over two years, lacks free cash flow generation, and also faces declining returns on capital.
Sysco Stock Looks Undervalued on Earnings Despite Mixed Broader Checks
Sysco stock appears undervalued on earnings-based measures, trading at a price-to-earnings ratio of about 23.0 times, which is below its estimated fair P/E of roughly 30.0 times. The shares recently closed at US$83.58, having delivered a 25.8% total return over the past five years. However, broader valuation checks present a more mixed picture, with four out of six tests pointing to attractive pricing but the overall assessment remaining balanced rather than a clear bargain. The key question is whether current margins and growth expectations can hold up enough for the P/E to re-rate closer to its fair multiple, or if cost pressures and demand risks in foodservice distribution justify the current discount.
Sysco Q1 Margin Gains Offset Russell 1000 Dynamic Index Removal
Sysco reported higher local case volumes and wider gross margins in its first quarter of fiscal 2026, with revenue growing year on year and matching analyst expectations. The company was removed from the Russell 1000 Dynamic Index around the same time, but the operational improvements drew investor attention. The continued rollout of Sysco's pricing agility tools is seen as key to sustaining the margin gains. The broader investment case still hinges on restaurant traffic resilience amid a choppy macro backdrop.
Consumer Discretionary Stocks Q1 In Review: Sysco Vs Peers
The consumer discretionary sector saw mixed Q1 results, with revenues beating analyst estimates by 2% on average but next-quarter guidance coming in 4.1% below expectations. Sysco reported revenues of $20.52 billion, up 4.7% year-on-year and in line with estimates, while Smith & Wesson posted the best performance with revenues of $178.4 million, a 26.7% increase that beat expectations by 14.9%. Leggett & Platt was the weakest, with revenues of $918.2 million, down 10.2% and missing estimates by 3.3%. Wyndham and Figs also reported, with Figs seeing a 28% revenue jump to $159.9 million but its stock falling 26.5% since the release.
Big Food failing to meet hype on regenerative agriculture
The FAIRR investor network reports a widening credibility gap in how the world's biggest food companies are implementing regenerative agriculture plans. Quantified regenerative agriculture targets have fallen from 35% of assessed companies in 2023 to 28%, and no company has set a pesticide reduction target despite more than half identifying reduced agrochemical inputs as a goal. Only Conagra Brands, Danone, Nestlé, and Sysco measure herbicide use in their programmes. While the share of companies measuring regenerative agriculture outcomes rose from 16% in 2023 to 54% in 2026, most measurement remains at the project level rather than company-wide, making it difficult for investors to assess scale and impact.
UNFI Turns to AI and Lean Ops as Organic Demand Grows
United Natural Foods is leveraging AI-powered supply-chain tools and lean management practices to improve efficiency and cash flow while natural and organic demand supports growth. The company has expanded its AI procurement platform across all distribution centers and broadened its AI fleet management system, helping on-time deliveries rise more than 4% year to date and average miles per delivery fall nearly 5%. Lean Daily Management has been implemented across 40 distribution centers, contributing to a more than 7% increase in distribution-center productivity and a nearly 7% year-over-year decline in operating expenses in the fiscal third quarter. Free cash flow reached $243 million year to date, up $90 million from the prior-year period, reducing net debt to $1.63 billion and net leverage to 2.5 times. Natural segment sales rose 4.4% year over year to $4.34 billion in the fiscal third quarter, with underlying natural growth again outperforming the market and the two-year stack remaining in the mid-teens for the past five quarters. The company also introduced more than 30 new private-brand SKUs and offers an Endless Aisle marketplace for emerging brands. Macro pressures from inflation, fuel costs, and competition from Sysco and US Foods remain risks, and the stock carries a Neutral recommendation with no Zacks Rank or Style Scores provided.