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what it is
Sysco buys, warehouses, and delivers food and restaurant supplies to places that need dinner served on time.
how it gets paid
Last year Sysco made $81.4B in revenue. U.S. operations was the main engine at $60.2B, or 74% of sales.
why it's growing
Revenue grew 3.2% last year. Yahoo consensus showed a 1.02% EPS beat. also said adjusted September-quarter earnings were $1.15.
what just happened
The latest quarter was fine, with a narrow beat as EPS came in at $0.99 versus a $0.98 estimate.
At a glance
B++ balance sheet — above average — nothing keeping you up at night
40/100 earnings predictability — expect surprises
16.7x trailing p/e — the market's not buying it — or you found a deal
2.9% dividend yield — cash in your pocket every quarter
20.5% return on capital — every dollar works hard here
xvary composite: 64/100 — average
What they do
Sysco buys, warehouses, and delivers food and restaurant supplies to places that need dinner served on time.
Sysco wins because scale is boring until you need it. It serves about 730,000 customer locations through 337 distribution facilities, so your restaurant is less likely to gamble on a smaller distributor with fewer trucks and thinner inventory. International sales were 26% of 2025 revenue, and that spread matters when U.S. local case volume is down 0.2%.
How they make money
$81.4B
annual revenue · their business grew +3.2% last year
U.S. operations
$60.2B
0.2%
Europe operations
$16.1B
+3.2%
Canada operations
$4.6B
+3.2%
Other international
$0.5B
+3.2%
The products that matter
distributes food and supplies in the U.S.
U.S. Foodservice Distribution
$64.3B · 79% of revenue
it's the core $64.3B business, and the 0.2% decline matters because this segment still drives almost four out of every five sales dollars.
79% of revenue
serves customers outside the U.S.
International Operations
$16.1B · +8.0%
this $16.1B segment is only about one-fifth of revenue, but it is growing far faster than the domestic business.
fastest-growing segment
small non-core operations
Other
$1.0B · flat
at $1.0B, this bucket is too small and too flat to change the story on its own.
not thesis-moving
Key numbers
20.5%
return on capital
Return on capital → profit generated from each dollar invested → so what: Sysco still turns a low-margin business into solid capital efficiency.
16.7x
trailing p/e
P/E → price compared with last year's earnings → so what: you are not paying a premium multiple for a defensive market leader.
$11.5B
long-term debt
Debt → money the company owes → so what: it is manageable at 24% of capital, but it trims flexibility.
2.9%
dividend yield
Dividend yield → cash paid back to you each year at today's price → so what: part of your return is paid while you wait.
Financial health
B++
strength
- balance sheet grade B++ — above average financial health
- risk rank 2 — safer than 80% of stocks
- price stability 95 / 100
- long-term debt $11.5B (24% of capital)
- net profit margin 2.9% — keeps 3 cents of every dollar in revenue
- return on equity 102% — $1.02 profit for every $1 investors have put in
B++ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in SYY 3 years ago → it's now worth $10,520.
The index would have given you $13,920.
source: institutional data · total return
What just happened
beat estimates
The latest quarter was fine, with a narrow beat as EPS came in at $0.99 versus a $0.98 estimate.
Yahoo consensus showed a 1.02% EPS beat. also said adjusted September-quarter earnings were $1.15, while the broader setup stayed subdued because U.S. local case volume fell 0.2%.
$41.9B
revenue
$1.80
eps
18.4%
gross margin
the number that mattered
The 0.2% drop in U.S. local cases mattered most because volume, not accounting, tells you whether the core engine is getting stronger.
-
sysco reported solid results to start fiscal 2026. (year ends june 27th.) september-quarter adjusted earnings of $1.15 a share were up 6% from the prior-year period and surpassed our estimate by $0.03.
-
volume trends remain underwhelming — local cases were down 0.2% in the u.s., the fourth consecutive negative comparison.management, though, noted that trends improved from the june period, and there were further signs of progress in the month of october.
-
meanwhile, international operations (about 19% of revenues) remain a bright spot, having posted eightconsecutive quarters of double-digit growth in adjusted operating income.
-
the full-year outlook remains relatively subdued.
-
despite the better-than-expected september-quarter performance, the company left its full-year profit guidance unchanged at $4.50-$4.60, which would represent growth of 1%-3%.higher incentive compensation represents one headwind, likely reducing the bottom line by roughly $0.15 a share in fiscal 2026. meanwhile, volumes trends in the u.s., as noted earlier, appear to be headed in the right direction, and the productivity of the sales force should benefit from reductions in turnover and the introduction of artificial intelligence powered tools.
source: company earnings report, 2026
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What could go wrong
the #1 risk is continued weakness in U.S. local case volume. Sysco is stable on the surface, but the segment that matters most is the one losing momentum.
med
U.S. volume decline
U.S. local case volume fell 0.2% last quarter. That was the fourth straight quarterly decline in the business that produces 79% of revenue.
with $64.3B in U.S. segment revenue, even small volume slippage moves a very large base.
med
razor-thin margins
net profit margin is 2.6%. That's what distribution businesses look like when scale helps but pricing power doesn't do miracles.
a 10 basis point margin squeeze on $81.4B of revenue would hit profit by roughly $81M.
low
litigation overhang
Burford Capital is suing Sysco over control of a $140M antitrust settlement.
this looks more like a one-time hit than a thesis killer, but one-time hits still count when growth is slow.
med
guidance leaves little room for error
full-year EPS guidance stayed at $4.50–$4.60, and higher incentive compensation is expected to reduce fiscal 2026 earnings by about $0.15 a share.
when the profit growth target is only 1%–3%, a $0.15 drag matters.
79% of Sysco's revenue comes from the U.S. core, and the company keeps only 2.6 cents of each sales dollar. If that core does not return to positive volume growth, the defensive-stock narrative starts to look expensive at any multiple.
source: institutional data · regulatory filings · risk analysis
Pay attention to
trend
U.S. local case volume
the 0.2% decline matters more than any single EPS print because this is the core segment. You want to see this turn positive and stay there.
metric
gross margin
gross margin was 18.3%. In a 2.6% net margin business, small cost shifts travel fast.
guide
full-year EPS band
management left guidance at $4.50–$4.60. If future updates do not move above that range, the stock stays a wait-and-see story.
risk
Burford lawsuit
the $140M settlement dispute is not the main thesis, but it is the kind of side issue that can muddy a low-growth year.
Analyst rankings
short-term outlook
average
outlook rank 3 — in human-speak, analysts do not see a strong near-term edge here.
risk profile
above average
risk rank 2 — safer than roughly 80% of stocks. This is the boring part of the story, and boring has value.
chart momentum
top 20%
momentum rank 2 — the stock's recent price action has been better than most. Price is holding up better than the operating narrative.
earnings predictability
40 / 100
earnings predictability is weak for a company this stable-looking. Expect quarter-to-quarter noise.
source: institutional data
Institutional activity
institutions have been net selling for 3 consecutive quarters — 628 buyers vs. 699 sellers in 3q2025. total institutional holdings: 0.4B shares. net selling for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$65
$108
$74
current price
$87
target midpoint · +17% from current · 3-5yr high: $130 (+75% · 17% ann'l return)
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