Pivotal Research Keeps a Sell Rating on United Natural Foods (UNFI)

Pivotal Research analyst Ajay Jain reiterated a Sell rating on United Natural Foods (UNFI) today and set a price target of $18. The company’s shares closed yesterday at $20.83, close to its 52-week low of $20.61.

Jain said:

“We reiterate our price target of $18 which remains highly sensitive based on target debt and EBITDA levels. The recent operational missteps reflected in Supervalu’s latest financials need to be better accounted for in guidance. Based on UNFI’s high leverage and earnings volatility, we estimate $25 million of variability in annual EBITDA has a $3/share corresponding impact on the price target. Consensus estimates remain way too high for FY19 – Based on the close of the stock market on Dec. 5, UNFI is now set to report 1Q19 results after the close on Thu., 12/6 followed by an earnings call at 5 pm EST (dial in #: 877.682.3423 and conf. ID: 6861809). Ahead of the print, UNFI has announced the sale of Hornbacher’s retail banner in Fargo ND. The sale includes a long-term supply agreement with Supervalu.”

According to TipRanks.com, Jain is a 4-star analyst with an average return of 11.1% and a 61.0% success rate. Jain covers the Services sector, focusing on stocks such as Walgreens Boots Alliance, Performance Food Group, and US Food Holdings Corp.

United Natural Foods has an analyst consensus of Hold, with a price target consensus of $28.17.

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The company has a one-year high of $52.59 and a one-year low of $20.61. Currently, United Natural Foods has an average volume of 1.37M.

Based on the recent corporate insider activity of 55 insiders, corporate insider sentiment is negative on the stock.

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United Natural Foods, Inc. engages in the distribution of natural, organic, and specialty foods and non-food products. It operates through the Wholesale and Other segment. The Wholesale segment distributes nutritional supplements, personal care items and organic products. The Others segment includes the sale other activities of the firm.

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