Sysco vs US Foods Which Is a Better Investment?

Sysco and US Foods are two of the largest foodservice distributors in the United States, with both companies supplying restaurants, healthcare facilities, and other establishments with a wide range of food products. Investors interested in the foodservice industry may consider comparing the stocks of these two companies to determine the best investment opportunity. Sysco has a long history of steady growth and profitability, while US Foods has shown strong performance in recent years. By examining factors such as financial performance, market share, and industry trends, investors can make informed decisions about investing in either Sysco or US Foods stocks.

Sysco or US Foods?

When comparing Sysco and US Foods, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Sysco and US Foods.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Sysco has a dividend yield of 2.53%, while US Foods has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Sysco reports a 5-year dividend growth of 6.58% year and a payout ratio of 51.82%. On the other hand, US Foods reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Sysco P/E ratio at 20.21 and US Foods's P/E ratio at 28.90. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Sysco P/B ratio is 17.78 while US Foods's P/B ratio is 3.61.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Sysco has seen a 5-year revenue growth of 0.34%, while US Foods's is 0.33%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Sysco's ROE at 90.60% and US Foods's ROE at 11.98%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $79.65 for Sysco and $68.87 for US Foods. Over the past year, Sysco's prices ranged from $69.03 to $82.89, with a yearly change of 20.08%. US Foods's prices fluctuated between $43.24 and $72.84, with a yearly change of 68.46%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.