US Foods
USFD
$95.34
-0.75%
US Foods Holding Corp. is a leading domestic foodservice distributor, providing over 350,000 food and non-food products to approximately 250,000 customer locations, including independent restaurants, chain restaurants, healthcare facilities, and hospitality clients. As the second-largest broadline distributor in the U.S., US Foods holds a 10% market share in a highly fragmented industry, competing directly with Sysco and Performance Food Group. The current investor narrative centers on the company's ability to sustain growth through market share gains, margin expansion from its 'Great Food Made Easy' strategy, and the successful integration of its Chef'Store cash-and-carry locations, while navigating food inflation and shifting demand patterns in the post-pandemic environment.…
USFD
US Foods
$95.34
Investment Opinion: Should I buy USFD Today?
Based on the analysis, USFD is rated a Buy. The stock offers a compelling risk/reward with an average analyst target of $115.875, implying 11.4% upside, and a PEG ratio of 0.56, suggesting undervaluation relative to growth. The company's forward PE of 18.84x is reasonable for a company expected to grow EPS by ~36%.
Sign up to view all
USFD 12-Month Price Forecast
The AI assessment is bullish with medium confidence. USFD's valuation metrics suggest the market is pricing in significant earnings growth, which is supported by the company's margin expansion and cash flow generation. However, the decelerating revenue growth and high debt levels introduce uncertainty. If the company can deliver on earnings expectations, the stock has upside to the average target. Key developments to watch include quarterly revenue growth, margin trends, and debt reduction progress. A downgrade to neutral would occur if revenue growth falls below 2% or if operating margins contract.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on US Foods's 12-month outlook, with a consensus price target around $115.88 and implied upside of +21.5% versus the current price.
Average Target
$115.88
0 analysts
Implied Upside
+21.5%
vs. current price
Analyst Count
—
covering this stock
Price Range
$61 - $130
Analyst target range
The high target of $130.00 assumes continued market share gains, successful margin expansion, and a favorable macroeconomic environment, potentially leading to multiple expansion. Conversely, the low target of $61.00 reflects concerns about a potential recession, increased competition, or a failure to achieve operational efficiencies. Recent institutional ratings show a mix of Neutral and Buy actions, with Piper Sandler downgrading from Overweight to Neutral in February 2026, while others like JP Morgan and Citigroup have maintained their positions. This mixed sentiment, combined with the wide target range, suggests that while the consensus is moderately bullish, there is considerable debate about the stock's future trajectory.
Bulls vs Bears: USFD Investment Factors
USFD presents a balanced risk/reward profile. On the bullish side, the company boasts strong relative performance, attractive forward valuation, consistent revenue growth, and solid cash generation. However, bears point to high trailing PE, decelerating growth, elevated debt, and mixed analyst sentiment. Currently, the bull case has slightly stronger evidence given the PEG ratio of 0.56 and the company's ability to grow earnings faster than revenue through margin expansion. The central tension is whether USFD can sustain its earnings growth trajectory to justify the forward PE; if it does, the stock has upside to analyst targets, but any shortfall could lead to multiple compression and a significant pullback.
Bullish
- Strong Relative Performance: USFD has outperformed the S&P 500 significantly, with a 33.38% gain over the past year versus 18.65% for the index. This demonstrates strong market confidence and momentum, supported by a 39.39% YTD gain.
- Attractive Valuation on Forward Earnings: The forward PE of 18.84x is well below the trailing PE of 25.63x, implying expected EPS growth of ~36%. The PEG ratio of 0.56 suggests the stock is undervalued relative to its growth prospects, making it appealing for growth investors.
- Consistent Revenue Growth: Revenue grew 2.77% YoY in Q1 2026 to $9.61 billion, following a 4.9% growth in Q2 2025. The company continues to expand in a mature industry, driven by market share gains and resilient demand from independent and chain restaurants.
- Solid Profitability and Cash Flow: USFD generated $848 million in free cash flow over the TTM, supporting debt reduction and reinvestment. Operating margin improved to 3.125% in Q1 2026 from 2.45% a year earlier, reflecting operational leverage and cost discipline.
Bearish
- High Valuation on Trailing Earnings: The trailing PE of 25.63x is elevated for a food distributor with low-single-digit revenue growth. This premium pricing leaves little room for error; any earnings miss could trigger multiple compression.
- Decelerating Revenue Growth: Revenue growth slowed to 2.77% YoY in Q1 2026 from 4.9% in Q2 2025, indicating a moderating trend. Management's guidance suggests continued low-single-digit growth, which may not justify the current valuation.
- High Debt Levels: The debt-to-equity ratio of 1.33x is elevated, reflecting significant leverage. Interest expenses of $75 million in Q1 2026 consume a large portion of operating income, increasing vulnerability to rising rates or economic downturns.
- Mixed Analyst Sentiment: Recent actions include Piper Sandler downgrading USFD from Overweight to Neutral in February 2026. The wide target range ($61 to $130) indicates significant disagreement among analysts about the company's future prospects.
USFD Technical Analysis
USFD has demonstrated a robust long-term uptrend, with the stock price appreciating 33.38% over the past year, significantly outperforming the S&P 500's 18.65% gain. The current price of $104.04 sits at 93.4% of its 52-week range (between $69.875 low and $111.42 high), indicating the stock is trading near its highs, reflecting strong momentum and investor confidence. This positioning suggests the market is rewarding the company's consistent execution, though it also raises the risk of a potential pullback if sentiment shifts.
Beta
0.82
0.82x market volatility
Max Drawdown
-21.1%
Largest decline past year
52-Week Range
$70-$111
Price range past year
Annual Return
+19.4%
Cumulative gain past year
| Period | USFD Return | S&P 500 |
|---|---|---|
| 1m | -14.1% | -1.1% |
| 3m | +2.2% | +3.0% |
| 6m | +0.8% | +15.4% |
| 1y | +19.4% | +16.2% |
| ytd | +27.7% | +12.1% |
Bobby - Your AI Investment Partner
Get real-time data, AI-driven personalized investment analysis to make smarter investment decisions
USFD Fundamental Analysis
US Foods reported revenue of $9.61 billion in Q1 2026, representing a 2.77% year-over-year growth rate, a slight deceleration from the 4.9% growth seen in Q2 2025. The company's revenue trajectory remains positive, driven by case volume growth and pricing, with independent restaurants (33% of sales) and chain restaurants (23%) leading demand. However, the growth rate is moderating as the company laps strong prior-year comparisons, and management's guidance suggests a continued low-single-digit growth outlook for the fiscal year.
Quarterly Revenue
$9.6B
2026-03
Revenue YoY Growth
+2.8%
YoY Comparison
Gross Margin
17.2%
Latest Quarter
Free Cash Flow
$848000000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
Open an Account, get $2 TSLA now!
Valuation Analysis: Is USFD Overvalued?
Given USFD's positive net income of $116 million in Q1 2026, the price-to-earnings (PE) ratio is the most appropriate valuation metric. The trailing PE stands at 25.63x, while the forward PE is 18.84x, indicating the market expects significant earnings growth in the coming year. The gap between trailing and forward PE suggests an expected EPS increase of approximately 36%, driven by margin expansion and operational leverage. This is supported by the PEG ratio of 0.56, which implies the stock is undervalued relative to its growth rate.
PE
25.6x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 14x~45x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
13.8x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks are notable. USFD carries a debt-to-equity ratio of 1.33x, and interest expenses of $75 million in Q1 2026 represent about 35% of operating income ($216 million). This leverage amplifies the impact of any margin contraction or revenue decline. The company's net margin is thin at 1.71%, leaving little buffer for cost inflation or pricing pressure. Additionally, revenue growth is decelerating, with Q1 2026 growth of 2.77% down from 4.9% in Q2 2025, indicating that the company may struggle to maintain momentum in a competitive market.
FAQ
The key risks for USFD include: 1) Financial risk from high debt levels (debt-to-equity of 1.33x), which increases vulnerability to interest rate hikes and economic downturns. 2) Operational risk from decelerating revenue growth (2.77% YoY in Q1 2026), which may indicate market saturation or increased competition. 3) Macro risk from a potential recession, which could reduce restaurant traffic and demand for foodservice distribution. 4) Company-specific risk from integration challenges with Chef'Store or other strategic initiatives. The most severe risk is a recession combined with high debt, which could lead to a significant drop in earnings and a de-rating of the stock, potentially to the 52-week low of $69.875.
The 12-month forecast for USFD is moderately bullish. The base case, with a 50% probability, targets a price range of $104-$116, aligning with the average analyst target of $115.875. The bull case, with a 30% probability, targets $115-$130, driven by strong execution and market share gains. The bear case, with a 20% probability, targets $70-$90, reflecting a potential recession or operational missteps. The most likely scenario is the base case, assuming the company continues to deliver low-single-digit revenue growth and modest margin expansion. Investors should monitor quarterly earnings for signs of acceleration or deceleration.
USFD appears undervalued based on forward metrics, with a forward PE of 18.84x and a PEG ratio of 0.56, which is below the typical threshold of 1 for fair value. The trailing PE of 25.63x is higher, but this reflects past earnings that are expected to grow significantly. Compared to the broader market, USFD's forward PE is lower than the S&P 500's average of around 20x, and its PEG ratio is more attractive. The market is pricing in substantial earnings growth, as evidenced by the gap between trailing and forward PE. If the company meets these expectations, the stock is undervalued; if not, it could be overvalued.
USFD is a good buy for investors with a medium-to-long-term horizon, given its attractive PEG ratio of 0.56 and forward PE of 18.84x, which suggest undervaluation relative to expected growth. The average analyst target of $115.875 implies an 11.4% upside from the current price of $104.04. However, the stock is not without risks, including high debt levels and decelerating revenue growth. For investors comfortable with these risks and seeking a value-growth blend, USFD offers a favorable risk/reward. It is particularly suitable for those who believe the company can sustain its earnings growth trajectory through margin expansion and market share gains.
USFD is more suitable for long-term investment, given its moderate growth profile and reasonable valuation. The stock has a beta of 0.819, indicating lower volatility than the market, which may appeal to risk-averse investors. The company does not pay a dividend, so returns are driven by capital appreciation. With a PEG ratio of 0.56, the stock is positioned for sustained growth over several years. A minimum holding period of 3-5 years is recommended to allow the earnings growth to materialize and the valuation to be recognized. Short-term trading is possible given the stock's momentum, but it carries higher risk due to potential pullbacks after strong runs.