SYSCO CORP (SYY) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:SYY - US8718291078 - Common Stock
76.21 USD
-0.63 (-0.82%)
76.21 USD
0 (0%)
Taking everything into account, SYY scores 5 out of 10 in our fundamental rating. SYY was compared to 38 industry peers in the Consumer Staples Distribution & Retail industry. SYY scores excellent on profitability, but there are some minor concerns on its financial health. SYY is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
- SYY had positive earnings in the past year.
- SYY had a positive operating cash flow in the past year.
- SYY had positive earnings in each of the past 5 years.
- In the past 5 years SYY always reported a positive cash flow from operatings.
1.2 Ratios
- The Return On Assets of SYY (6.71%) is better than 71.05% of its industry peers.
- SYY has a better Return On Equity (87.76%) than 97.37% of its industry peers.
- SYY has a Return On Invested Capital of 16.61%. This is amongst the best in the industry. SYY outperforms 94.74% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for SYY is significantly below the industry average of 28.30%.
- The last Return On Invested Capital (16.61%) for SYY is above the 3 year average (15.85%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.71% | ||
| ROE | 87.76% | ||
| ROIC | 16.61% |
ROA(3y)7.48%
ROA(5y)6.21%
ROE(3y)97.71%
ROE(5y)85.04%
ROIC(3y)15.85%
ROIC(5y)13.74%
1.3 Margins
- SYY has a better Profit Margin (2.21%) than 60.53% of its industry peers.
- In the last couple of years the Profit Margin of SYY has grown nicely.
- SYY has a Operating Margin of 4.33%. This is in the better half of the industry: SYY outperforms 73.68% of its industry peers.
- SYY's Operating Margin has improved in the last couple of years.
- SYY has a Gross Margin of 18.43%. This is in the lower half of the industry: SYY underperforms 63.16% of its industry peers.
- SYY's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.33% | ||
| PM (TTM) | 2.21% | ||
| GM | 18.43% |
OM growth 3Y8.19%
OM growth 5Y19.17%
PM growth 3Y4.31%
PM growth 5Y40.76%
GM growth 3Y0.82%
GM growth 5Y-0.35%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), SYY is creating value.
- The number of shares outstanding for SYY has been reduced compared to 1 year ago.
- Compared to 5 years ago, SYY has less shares outstanding
- The debt/assets ratio for SYY is higher compared to a year ago.
2.2 Solvency
- An Altman-Z score of 5.11 indicates that SYY is not in any danger for bankruptcy at the moment.
- SYY has a better Altman-Z score (5.11) than 76.32% of its industry peers.
- The Debt to FCF ratio of SYY is 8.35, which is on the high side as it means it would take SYY, 8.35 years of fcf income to pay off all of its debts.
- The Debt to FCF ratio of SYY (8.35) is comparable to the rest of the industry.
- SYY has a Debt/Equity ratio of 5.54. This is a high value indicating a heavy dependency on external financing.
- SYY has a Debt to Equity ratio of 5.54. This is amonst the worse of the industry: SYY underperforms 89.47% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.54 | ||
| Debt/FCF | 8.35 | ||
| Altman-Z | 5.11 |
ROIC/WACC2.19
WACC7.57%
2.3 Liquidity
- A Current Ratio of 1.15 indicates that SYY should not have too much problems paying its short term obligations.
- Looking at the Current ratio, with a value of 1.15, SYY is in line with its industry, outperforming 55.26% of the companies in the same industry.
- SYY has a Quick Ratio of 1.15. This is a bad value and indicates that SYY is not financially healthy enough and could expect problems in meeting its short term obligations.
- Looking at the Quick ratio, with a value of 0.65, SYY is in line with its industry, outperforming 52.63% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.15 | ||
| Quick Ratio | 0.65 |
3. Growth
3.1 Past
- SYY shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.39%.
- The Earnings Per Share has been growing by 17.52% on average over the past years. This is quite good.
- SYY shows a small growth in Revenue. In the last year, the Revenue has grown by 2.92%.
- Measured over the past years, SYY shows a quite strong growth in Revenue. The Revenue has been growing by 9.00% on average per year.
EPS 1Y (TTM)4.39%
EPS 3Y11.01%
EPS 5Y17.52%
EPS Q2Q%5.5%
Revenue 1Y (TTM)2.92%
Revenue growth 3Y5.84%
Revenue growth 5Y9%
Sales Q2Q%3.24%
3.2 Future
- SYY is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.09% yearly.
- The Revenue is expected to grow by 4.22% on average over the next years.
EPS Next Y3.61%
EPS Next 2Y6.95%
EPS Next 3Y7.3%
EPS Next 5Y11.09%
Revenue Next Year3.92%
Revenue Next 2Y4.46%
Revenue Next 3Y4.04%
Revenue Next 5Y4.22%
3.3 Evolution
- The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 16.86 indicates a correct valuation of SYY.
- SYY's Price/Earnings ratio is a bit cheaper when compared to the industry. SYY is cheaper than 65.79% of the companies in the same industry.
- SYY's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.21.
- SYY is valuated correctly with a Price/Forward Earnings ratio of 14.94.
- 65.79% of the companies in the same industry are more expensive than SYY, based on the Price/Forward Earnings ratio.
- When comparing the Price/Forward Earnings ratio of SYY to the average of the S&P500 Index (24.26), we can say SYY is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.86 | ||
| Fwd PE | 14.94 |
4.2 Price Multiples
- 65.79% of the companies in the same industry are more expensive than SYY, based on the Enterprise Value to EBITDA ratio.
- SYY's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.82 | ||
| EV/EBITDA | 10.98 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- SYY has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)4.68
PEG (5Y)0.96
EPS Next 2Y6.95%
EPS Next 3Y7.3%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.81%, SYY has a reasonable but not impressive dividend return.
- SYY's Dividend Yield is rather good when compared to the industry average which is at 0.73. SYY pays more dividend than 92.11% of the companies in the same industry.
- SYY's Dividend Yield is rather good when compared to the S&P500 average which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.81% |
5.2 History
- The dividend of SYY has a limited annual growth rate of 4.23%.
- SYY has paid a dividend for at least 10 years, which is a reliable track record.
- The dividend of SYY decreased in the last 3 years.
Dividend Growth(5Y)4.23%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
- SYY pays out 55.57% of its income as dividend. This is a bit on the high side, but may be sustainable.
- The dividend of SYY is growing, but earnings are growing more, so the dividend growth is sustainable.
DP55.57%
EPS Next 2Y6.95%
EPS Next 3Y7.3%
SYSCO CORP / SYY FAQ
What is the ChartMill fundamental rating of SYSCO CORP (SYY) stock?
ChartMill assigns a fundamental rating of 5 / 10 to SYY.
What is the valuation status of SYSCO CORP (SYY) stock?
ChartMill assigns a valuation rating of 4 / 10 to SYSCO CORP (SYY). This can be considered as Fairly Valued.
What is the profitability of SYY stock?
SYSCO CORP (SYY) has a profitability rating of 7 / 10.
What is the expected EPS growth for SYSCO CORP (SYY) stock?
The Earnings per Share (EPS) of SYSCO CORP (SYY) is expected to grow by 3.61% in the next year.
Can you provide the dividend sustainability for SYY stock?
The dividend rating of SYSCO CORP (SYY) is 6 / 10 and the dividend payout ratio is 55.57%.