Update (9:47 a.m.): Updated with Tuesday market open information.
NEW YORK (TheStreet) -- UBS increased its target price on United Natural Foods (UNFI - Get Report) to $75 and set a "neutral" rating. The firm noted the company's continued acceleration in independent channel growth.
The stock was rising 0.86% to $76.04 at 9:47 a.m. on Tuesday.
Separately, TheStreet Ratings team rates UNITED NATURAL FOODS INC as a "buy" with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate UNITED NATURAL FOODS INC (UNFI) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth, compelling growth in net income, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company shows low profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 7.2%. Since the same quarter one year prior, revenues rose by 13.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- UNITED NATURAL FOODS INC has improved earnings per share by 30.2% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, UNITED NATURAL FOODS INC increased its bottom line by earning $2.18 versus $1.86 in the prior year. This year, the market expects an improvement in earnings ($2.51 versus $2.18).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Food & Staples Retailing industry average. The net income increased by 28.9% when compared to the same quarter one year prior, rising from $21.54 million to $27.76 million.
- Net operating cash flow has increased to -$49.66 million or 10.44% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -10.82%.
- Powered by its strong earnings growth of 30.23% and other important driving factors, this stock has surged by 51.14% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- You can view the full analysis from the report here: UNFI Ratings Report