NEW YORK (TheStreet) -- Shares of Sysco Corp. (SYY) closed up 1.92% to $38.21 on Tuesday after analysts at Credit Suisse today upgraded the company to "outperform" from "neutral" and raised their price target to $43 from $38.
Analysts said that the biggest U.S. food distributor's stock risk/reward has turned more positive.
"While the company's attempted acquisition of U.S. Foods remains highly uncertain, we see upside in the stock at the current price with or without the deal," they added. Of course if the deal were completed, analysts highlighted that it would prove beneficial for the stock due to consolidation gains.
The court decision regarding the merger is expected in June.
However, regulatory filings show that Sysco will be left with a bill of around $1 billion if the U.S. government kills its $2.5 billion merger with U.S. Foods, underscoring the perils of doing deals that have a good chance of being blocked by antitrust regulators, Reuters reported.
TheStreet Ratings team rates SYSCO CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate SYSCO CORP (SYY) 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 and good cash flow from operations. We feel its strengths outweigh the fact that the company shows low profit margins."