Core Viewpoint - Sysco Corp. is identified as a valuable investment opportunity for value investors, offering strong performance at a reasonable price-to-earnings (P/E) ratio within a stable industry [1] Company Summary - Sysco Corp. is highlighted as a high-performing company that is not facing significant industry challenges, making it an attractive option for investors [1]

Core Insights - Sysco Corporation's international business is becoming a significant contributor to overall performance, driven by steady execution and improving fundamentals [1] Group 1: International Business Performance - The international segment is gaining traction as a stronger growth engine, providing both sales momentum and improving profitability across regions [1] - In Q1 of fiscal 2026, international local case volume grew approximately 5%, indicating solid engagement with local customers, which typically offer more attractive economics and less volatility [2] - International gross margin increased by 43 basis points to 20.8%, attributed to disciplined pricing, strategic sourcing, and improved supply-chain execution [3] Group 2: Profit Growth and Consistency - Adjusted operating income rose 13.1%, marking the eighth consecutive quarter of double-digit profit growth, with operational consistency across geographies playing a key role [4] - Every major international region contributed to growth, supported by higher service levels, reduced product shrink, and better productivity across the supply chain [4] Group 3: Long-term Outlook - Sysco's international business is evolving into a more durable growth driver, enhancing the company's diversification and reinforcing the quality of its long-term earnings profile [5]

Valued at $35.6 billion by market cap, Sysco Corporation (SYY) is a leading American multinational food-service distribution company and a core participant in the consumer staples sector. Headquartered in Houston, Texas, Sysco primarily markets and distributes a broad range of food and related products, including fresh, frozen, and prepared foods, meat, seafood, produce, dairy, beverages, and imported specialties, as well as non-food items such as disposable paper products, tableware, kitchen equipment, an ...

Group 1: Company Initiatives - Sysco Corporation's Purpose Month in November 2025 saw nearly 10,000 colleagues volunteer daily, marking the most successful year yet for the initiative [1] - The program involved participation from 339 sites across 9 countries, impacting over 1,700 individual charities to address global food insecurity [1][2] - Sysco's Purpose Month began in Canada in November 2022, aimed at combating hunger and increasing volunteer efforts, leading to a global expansion in 2023 [3] Group 2: Company Overview - Sysco is the global leader in foodservice distribution, operating 339 distribution centers in 10 countries and employing 75,000 colleagues [4] - The company generated sales exceeding $81 billion in fiscal year 2025, which ended on June 28, 2025 [4] - Sysco provides customized supply chain solutions and culinary support to help customers innovate and optimize their operations [5]

Core Insights - Sysco Corporation is partnering with the MICHELIN Guide to celebrate the Northeast Cities recipients of Michelin stars at a ceremony in Philadelphia on November 18, 2025 [1][2] - The MICHELIN Guide is recognized globally for its prestigious ratings and reviews of restaurants, covering major cities including New York City, Washington, D.C., Chicago, Boston, and Philadelphia [2] - Sysco aims to support culinary excellence and emerging talent through this partnership, highlighting its commitment to the foodservice community [3][6] Company Overview - Sysco is the global leader in selling, marketing, and distributing food and related products to various customers, including restaurants and healthcare facilities, operating 339 distribution centers across 10 countries [7][8] - The company generated over $81 billion in sales for the fiscal year 2025, ending June 28, 2025 [7] - Sysco provides a wide range of products and innovative solutions to help customers optimize their operations and enhance menu offerings [8]

Core Insights - Happy Day Brands partners with Sysco to launch a multistate hunger-relief event, packaging and donating over 1 million servings of nutritious cereal to local food banks on November 14 [2][3] - Sysco's Purpose Month emphasizes community service, with 75,000 colleagues dedicating time and resources to combat food insecurity [3][4] - Happy Day Brands has donated over 7 million meals since 2021 through its Good For You, Good For All™ initiative, supporting Feeding America® food banks [5][6] Company Overview - Happy Day Brands, founded in 2017, specializes in non-GMO, organic, and gluten-free food products, with a strong national presence through 44 Sysco distribution centers [4][6] - Sysco is the global leader in food distribution, generating over $81 billion in sales for fiscal year 2025, serving approximately 730,000 customer locations [7][8] Strategic Initiatives - The collaboration between Happy Day Brands and Sysco aims to address food insecurity and uplift communities, aligning with both companies' missions [2][3] - Sysco's Purpose Month allows employees to engage in hands-on efforts to support local food banks, reinforcing the company's commitment to community impact [4][3]

Core Insights - Sysco Corporation partners with the MICHELIN Guide to announce the recipients of Michelin stars in the American South, highlighting its role as a key player in the culinary industry [1][2] - The inaugural American South MICHELIN Guide Ceremony will take place on November 3, 2025, in Greenville, S.C., covering multiple states including South Carolina, North Carolina, Alabama, Tennessee, Louisiana, and Mississippi [2] Company Overview - Sysco is the global leader in selling, marketing, and distributing food and related products to various customers, including restaurants and healthcare facilities, operating 339 distribution centers across 10 countries [7][8] - The company generated sales exceeding $81 billion in fiscal year 2025, which ended on June 28, 2025 [7] Partnership Details - Sysco's partnership with the MICHELIN Guide began in November 2024, with a focus on celebrating culinary excellence and supporting chefs [6] - Sysco Carolinas Region President Matt Jacobson will present the MICHELIN Guide Young Chef Award at the ceremony, emphasizing the importance of nurturing emerging culinary talent [5][6] Product and Service Offerings - Sysco provides a broad assortment of industry-leading products, including fresh produce, premium proteins, and innovative culinary solutions, aimed at helping chefs innovate and optimize their operations [4][8]

Core Insights - Sysco Corporation has partnered with the MICHELIN Guide to announce the recipients of Michelin stars in the Carolinas, marking a significant collaboration in the culinary industry [1][2] - The inaugural MICHELIN Guide for the American South will include South Carolina, North Carolina, Alabama, Tennessee, Louisiana, Mississippi, and the pre-existing Atlanta Guide [2] - Sysco aims to support chefs and emerging culinary talent through this partnership, highlighting their commitment to the culinary community [3][5][6] Company Overview - Sysco is the global leader in selling, marketing, and distributing food and related products to various customers, including restaurants, healthcare, and educational facilities [7] - The company operates 339 distribution centers across 10 countries, employing 75,000 colleagues and serving approximately 730,000 customer locations [7] - In fiscal year 2025, Sysco generated sales exceeding $81 billion, showcasing its strong market presence [7] Product and Service Offerings - Sysco provides a broad assortment of industry-leading products, including fresh produce, premium proteins, specialty products, and innovative culinary solutions [8] - The company acts as a trusted business partner, helping customers innovate and optimize their operations through customized supply chain solutions and culinary support [8]

Financial Performance - Net earnings for the 13-week period ended September 27, 2025, were $476 million, compared to $490 million for the same period in 2024, reflecting a decrease of approximately 2.9%[49] - Basic earnings per share for the first quarter of fiscal 2026 were $0.99, down from $1.00 in the first quarter of fiscal 2025, indicating a decline of 1%[49] - Comprehensive income for the first quarter of fiscal 2026 was $445 million, a decrease of 32.9% from $663 million in the first quarter of fiscal 2025[50] - Total sales for the 13-week period ended September 27, 2025, were $21,148 million, compared to $20,484 million for the same period in 2024, reflecting a year-over-year increase of 3.2%[72] - Total operating income for the 13-week period ended September 27, 2025, was $800 million, compared to $808 million for the same period in 2024[72] Tax and Benefits - The effective tax rate for the first quarter of fiscal 2026 was 20.6%, lower than the statutory rate of 21.0%, primarily due to foreign income tax benefits[62] - As of September 27, 2025, the gross amount of unrecognized tax benefits was $68 million, with related accrued interest of $18 million[64] - Sysco recorded a benefit of $131 million related to foreign tax credits under the Tax Cuts and Jobs Act of 2017; potential reversal may occur if the company loses its legal challenge[65] - Sysco entered into a contract to purchase approximately $200 million of Transferable Tax Credits to offset fiscal 2026 federal income taxes[66] Share-Based Compensation - Share-based compensation costs recognized in the first quarter of fiscal 2026 totaled $31 million, slightly higher than $30 million in the same period of fiscal 2025[61] - A total of 721,368 stock options were granted to employees in the first 13 weeks of fiscal 2026, with a weighted average grant-date fair value of $19.53 per option[57] - Employees were granted 451,638 performance share units (PSUs) in the first 13 weeks of fiscal 2026, with a weighted average grant-date fair value of $86.23 per PSU[58] - The company had a total of $219 million of unrecognized compensation cost related to share-based compensation arrangements as of September 27, 2025, expected to be recognized over 2.18 years[61] - The number of securities excluded from the diluted earnings per share calculation due to anti-dilutive effects was approximately 1,718,000 for the first 13 weeks of fiscal 2026[49] Assets and Expenditures - Capital expenditures for the 13-week period ended September 27, 2025, totaled $160 million, an increase from $122 million in the same period in 2024[73] - Total assets as of September 27, 2025, were $27,044 million, up from $26,774 million as of June 28, 2025[73] Segment Performance - The company’s U.S. Foodservice Operations segment reported sales of $14,780 million for the 13-week period ended September 27, 2025[72] - The International Foodservice Operations segment reported sales of $3,966 million for the same period, compared to $3,794 million in the prior year[72] Market Risks - Sysco's market risks include interest rate risk, foreign currency exchange rate risk, fuel price risk, and investment risk, with no significant changes reported since June 28, 2025[140]

Core Insights - Sysco Corporation (SYY) started fiscal 2026 strongly, showing significant progress in sales performance, margin management, and supply chain operations [1] - The company's bottom line exceeded estimates, driven by robust local business performance, particularly in the U.S. Foodservice (USFS) local segment, which outperformed broader industry trends [2][3] Financial Performance - Sysco's adjusted earnings were $1.15 per share, surpassing the Zacks Consensus Estimate of $1.12, marking a 5.5% year-over-year increase [4][10] - Total sales reached $21.1 billion, a 3.2% increase year-over-year, nearly aligning with estimates, with foreign exchange contributing 0.4% to sales growth [4][10] - Gross profit rose 3.9% to $3.9 billion, with gross margin improving by 13 basis points to 18.5% [5] - Operating expenses increased by 5.3% year-over-year to $3.1 billion, while adjusted operating income rose 2.9% to $898 million [6] Segment Performance - U.S. Foodservice Operations saw sales rise 2.9% to $14.8 billion, with gross profit growing 2.8% to $2.8 billion [7] - International Foodservice Operations reported a 4.5% sales increase to $4 billion, with gross profit climbing 6.7% to $826 million [8][9] - The SYGMA segment's sales increased by 4.1% year-over-year to $2.129 billion, while the Other segment's sales decreased by 3.2% to $273 million [11] Financial Health - Sysco ended the quarter with cash and cash equivalents of $844 million and total liquidity of $3.5 billion [12] - Cash flow from operations was $86 million, while free cash flow was negative $50 million [12] - The company returned $259 million to shareholders through dividends during the quarter [13] Fiscal 2026 Outlook - Sysco reaffirmed its guidance for fiscal 2026, expecting sales growth of 3-5% and adjusted earnings per share growth of 1-3% [14] - The guidance includes a $100 million headwind related to lower incentive compensation from the previous year, with adjusted EPS growth anticipated to be 5-7% excluding this impact [14] Stock Performance - Sysco shares have declined by 2.9% over the past three months, compared to a 7.3% decline in the industry [15]