SYSCO Earnings: Powers With Profitability Past Estimates

S&P 500 (NYSE:SPY) component SYSCO Corporation (NYSE:SYY) reported net income above Wall Street’s expectations for the third quarter. Sysco, through its subsidiaries and divisions, is a distributor of food and related products.

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SYSCO Earnings Cheat Sheet for the Third Quarter

Results: Net income for the food items-wholesale rose to $259.6 million (44 cents per share) vs. $258.5 million (44 cents per share) in the same quarter a year earlier. This marks a rise of 0.4% from the year-earlier quarter.

Revenue: Rose 7.6% to $10.5 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: SYSCO Corporation reported adjusted net income of 49 cents per share. By that measure, the company beat the mean estimate of 43 cents per share. Analysts were expecting revenue of $10.49 billion.

Quoting Management: “I am pleased with our volume growth trends as we grew our business throughout the quarter by remaining focused on supporting the success of our customers,” said Bill DeLaney, Sysco’s president and chief executive officer. “Adjusted earnings growth fell short of our expectations, however, and our leadership team is fully committed to improving upon this aspect of our performance as we complete our fourth quarter and approach the beginning of the new fiscal year.”

Key Stats:

Revenue has increased for four quarters in a row. Revenue increased 9.2% to $10.24 billion in the second quarter. The figure rose 8.6% in the first quarter from the year earlier and climbed 0.7% in the fourth quarter of the last fiscal year from the year-ago quarter.

SYSCO (NYSE:SYY) has now beaten analyst estimates for three quarters in a row. It beat the mark by 2 cents in the second quarter and by 3 cents in the first quarter.

The increase in profit last quarter comes after net income fell in the previous quarter. In the second quarter, net income declined 3.1% to $250.1 million.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 55 cents a share to 54 cents over the last ninety days. At $1.92 per share, the average estimate for the fiscal year has fallen from $1.95 ninety days ago.

Competitors to Watch: Nash-Finch Company, Spartan Stores, Inc., United Natural Foods, Inc., Synergy Brands, Inc., Core-Mark Holding Co., Inc., AMCON Distributing Co., G. Willi-Food Intl. Ltd., and SUPERVALU INC.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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