United Natural Foods (UNFI) to Post Q4 Earnings: Things to Note

United Natural Foods, Inc. UNFI is likely to register top- and bottom-line growth when it reports fourth-quarter fiscal 2022 earnings on Sep 27. The Zacks Consensus Estimate for quarterly revenues is pegged at $7,347 million, suggesting a rise of 9.1% from the prior-year quarter’s reported figure.

The Zacks Consensus Estimate for quarterly earnings has risen by a cent in the past 30 days to $1.25 per share, which indicates a 5.9% growth from the figure reported in the prior-year quarter. The food company has a trailing four-quarter earnings surprise of 29.9%, on average. UNFI delivered an earnings surprise of 12.2% in the last reported quarter.

Factors to Note

United Natural Foods has been benefiting from its Fuel the Future strategy, unveiled in June 2021. Fuel the Future includes six pillars, fulfill power in scale, unlock customer experience, taste the future, UNFI pride, retail optimization and earn results. Management has been on track to increase market share via network optimization, solid innovation and a better customer experience. The company has been on track to undertake growth initiatives under its future pillar that includes brands, professional services and fresh.

United Natural Foods, Inc. Price, Consensus and EPS Surprise

United Natural Foods, Inc. price-consensus-eps-surprise-chart | United Natural Foods, Inc. Quote

 

The company also benefits from e-commerce strength, thanks to increased e-commerce solutions. Apart from this, business gains from current and new customers, including gains from cross-selling, have worked for UNFI.

On its last earnings call, management highlighted that it is impressed with gains from existing and new customers, which prompted it to increase its fiscal 2022 sales and earnings outlook. For fiscal 2022, management anticipates net sales of $28.8-$29.1 billion. At the midpoint, the metric suggests a 7% rise from the fiscal 2021 reported levels. The company expects adjusted EBITDA in the range of $810-$830 million, indicating a 6% increase at the midpoint of the guidance. The company anticipates fiscal 2022 adjusted earnings in the band of $4.65-$4.90 per share. At the midpoint, the metric indicates a 14% rise from the fiscal 2021 reported levels. These factors bode well for the quarter under review as well.

That said, industry-wide challenges, like inflation, are a concern.

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for United Natural Foods this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here.

United Natural Foods carries a Zacks Rank #2 and has an Earnings ESP of -0.80%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With the Favorable Combination

Here are some companies you may want to consider as our model shows that these also have the right combination of elements to post an earnings beat.

Kellogg Company K currently has an Earnings ESP of +1.04% and a Zacks Rank #3. K is expected to register top-line growth when it reports third-quarter 2022 numbers. The Zacks Consensus Estimate for Kellogg's quarterly revenues is pegged at $3.8 billion, which suggests growth of around 4% from the prior-year quarter’s reported figure. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Kellogg's quarterly earnings has dropped by a penny in the past 30 days to 96 cents per share, suggesting a decline of 11.9% from the year-ago quarter’s tally. K delivered an earnings beat of 13.3%, on average, in the trailing four quarters.

Sysco Corporation SYY currently has an Earnings ESP of +0.36% and a Zacks Rank #3. The company is likely to register top- and bottom-line improvement when it reports first-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for the quarterly EPS of 99 cents suggests a 19.3% improvement from the figure reported in the year-ago quarter.

The Zacks Consensus Estimate for Sysco’s quarterly revenues is pegged at $18.6 billion, which indicates an improvement of 13.1% from the figure reported in the prior-year quarter. SYY has a trailing four-quarter earnings surprise of 3.6%, on average.

Beyond Meat BYND currently has an Earnings ESP of +9.23% and a Zacks Rank of 3. The company is likely to register a rise in the top line when it reports third-quarter 2022 results. The Zacks Consensus Estimate for BYND’s quarterly revenues is pegged at $113.3 million, which suggests a jump of 6.4% from the figure reported in the prior-year quarter.

The consensus mark for Beyond Meat’s bottom line improved by a penny in the past seven days to a loss of $1.10 per share, compared with a loss of 87 cents reported in the year-ago quarter.

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