Sysco Corporation (SYY): Today's Featured Wholesale Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Sysco Corporation ( SYY) pushed the Wholesale industry lower today making it today's featured Wholesale laggard. The industry as a whole closed the day down 1.3%. By the end of trading, Sysco Corporation fell 77 cents (-2.4%) to $30.92 on heavy volume. Throughout the day, 6.5 million shares of Sysco Corporation exchanged hands as compared to its average daily volume of 3.1 million shares. The stock ranged in price between $30.78-$31.76 after having opened the day at $31.72 as compared to the previous trading day's close of $31.69. Other companies within the Wholesale industry that declined today were: InfoSonics Corporation ( IFON), down 6.2%, China Auto Logistics ( CALI), down 5%, Edgen Group Inc Class A ( EDG), down 5%, and Addvantage Technologies Group ( AEY), down 4.7%.
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Sysco Corporation, through its subsidiaries, engages in the marketing and distribution of a range of food and related products primarily to the foodservice or food-away-from-home industry. Sysco Corporation has a market cap of $18.59 billion and is part of the services sector. The company has a P/E ratio of 16.7, equal to the average wholesale industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Shares are up 8.1% year to date as of the close of trading on Thursday. Currently there are two analysts that rate Sysco Corporation a buy, one analyst rates it a sell, and seven rate it a hold.

TheStreet Ratings rates Sysco Corporation as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations, increase in stock price during the past year, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the wholesale industry could consider iShares Dow Jones US Cons Goods ( IYK) while those bearish on the wholesale industry could consider ProShares Ultra Sht Consumer Goods ( SZK).

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