Contrasting United Natural Foods (UNFI) and Its Peers

United Natural Foods (NASDAQ: UNFI) is one of 23 publicly-traded companies in the “Food Retail & Distribution” industry, but how does it weigh in compared to its peers? We will compare United Natural Foods to related companies based on the strength of its dividends, profitability, risk, institutional ownership, valuation, analyst recommendations and earnings.

Institutional and Insider Ownership

62.7% of shares of all “Food Retail & Distribution” companies are owned by institutional investors. 1.3% of United Natural Foods shares are owned by insiders. Comparatively, 19.2% of shares of all “Food Retail & Distribution” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and price targets for United Natural Foods and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
United Natural Foods 4 9 5 0 2.06
United Natural Foods Competitors 644 1344 1391 22 2.23

United Natural Foods currently has a consensus price target of $42.25, suggesting a potential upside of 3.48%. As a group, “Food Retail & Distribution” companies have a potential upside of 3.82%. Given United Natural Foods’ peers stronger consensus rating and higher probable upside, analysts plainly believe United Natural Foods has less favorable growth aspects than its peers.

Profitability

This table compares United Natural Foods and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
United Natural Foods 1.40% 8.10% 4.50%
United Natural Foods Competitors 0.80% 32.79% 4.17%

Valuation and Earnings

This table compares United Natural Foods and its peers revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
United Natural Foods $9.27 billion $318.94 million 15.95
United Natural Foods Competitors $21.46 billion $1.01 billion 39.04

United Natural Foods’ peers have higher revenue and earnings than United Natural Foods. United Natural Foods is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Volatility and Risk

United Natural Foods has a beta of 1.43, indicating that its stock price is 43% more volatile than the S&P 500. Comparatively, United Natural Foods’ peers have a beta of 0.93, indicating that their average stock price is 7% less volatile than the S&P 500.

Summary

United Natural Foods peers beat United Natural Foods on 10 of the 13 factors compared.

About United Natural Foods

United Natural Foods, Inc. is a distributor and retailer of natural, organic and specialty products. The Company’s segments include Wholesale and Other. The Wholesale segment is engaged in the national distribution of natural, organic and specialty foods, produce and related products in the United States and Canada. The Other segment includes a retail division, which engages in the sale of natural foods and related products to the general public through retail storefronts on the east coast of the United States; a manufacturing division, which engages in importing, roasting and packaging of nuts, seeds, dried fruit and snack items, and its branded product lines. Its operations consist of three operating divisions: Wholesale Division, Retail Division, and Manufacturing and Branded Products divisions. As of July 30, 2016, the Company had offered 100,000 natural, organic and specialty foods, and non-food products, consisting of national, regional and private-label brands.

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