Sysco's (SYY) stock upside opportunity outweighs its risk at current levels, with plenty of focus to be on its ability to achieve strong earnings per share growth, along with developments in its acquisition of Restaurant Depot, UBS said in a note emailed Wednesday.
The brokerage said the company showed that it is enhancing its foodservice distribution consistency, even if a slightly weaker-than-expected local case growth performance held back its shares post results.
UBS also said the company is seeing productivity step changes across its sales force, helped by improved retention and good uptake of its AI 360 selling tool.
UBS said the company expanded to its cost-out initiatives as it leans on tech and AI, which could help Sysco in $100 million total cost saves.
UBS maintained a buy rating and raised price target to $95 from $90.
Price: $84.89, Change: $+2.10, Percent Change: +2.54%