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On Friday, BMO Capital Markets adjusted its outlook on US Foods Holding Corp (NYSE:USFD), increasing the price target to $85 from the previous $80, while maintaining the Outperform rating on the company’s shares. With the stock currently trading at $71.44 and near its 52-week high of $73.19, this revision follows US Foods’ robust first-quarter earnings for 2025, which showcased strong EBITDA growth and affirmed their guidance for the year. According to InvestingPro data, analysts’ targets for the stock range from $61.62 to $90, reflecting varied expectations for this $16.45 billion market cap company.
US Foods, a leading foodservice distributor with annual revenue of $38.28 billion, reported first-quarter results that outperformed within the industry, achieving significant EBITDA growth to $1.62 billion. This occurred despite challenging macroeconomic conditions and adverse weather impacts, signaling the company’s effective operational execution and market share expansion. The firm’s performance is attributed to strategic growth investments and the successful implementation of "self-help" initiatives. InvestingPro analysis indicates a GREAT Financial Health Score of 3.11, suggesting robust operational fundamentals.
Analysts at BMO Capital have updated their financial model for US Foods, resulting in a 10% increase to their 2025 EBITDA forecast. This adjustment reflects the company’s cost reduction strategies and the acquisition of new accounts, which are expected to drive future earnings. The analysts’ confidence in US Foods’ capacity to navigate any business climate and consistently gain market share underpins the raised price target.
The updated price target of $85 represents BMO Capital’s belief in the ongoing success of US Foods. The company’s ability to deliver impressive results, even in the face of external pressures, underscores its resilience and operational strength. BMO Capital’s stance on US Foods remains positive, as indicated by the Outperform rating and the elevated price target.
In other recent news, US Foods Holding Corp. reported its first-quarter earnings for 2025, revealing an adjusted earnings per share (EPS) of $0.68, which was slightly below the forecast of $0.70. The company’s revenue reached $9.4 billion, narrowly missing the forecast of $9.42 billion, yet reflecting a 4.5% increase year-over-year. Despite these minor misses, US Foods reaffirmed its full-year guidance for 2025, projecting robust growth in adjusted EBITDA and EPS. The company also reported a 9.3% increase in adjusted EBITDA, totaling $389 million, supported by a 1.1% increase in case volume and strong growth in its private label segment.
Additionally, CFRA analyst Arun Sundaram raised the price target for US Foods to $59 from $58, while maintaining a Sell rating on the stock. Sundaram’s revision was based on updated earnings per share estimates for 2025 and 2026, despite acknowledging potential risks to the company’s outlook. US Foods has been expanding its customer base, with April noted as its strongest month in 2021 for acquiring new customers and accounts. The company has also announced a new $1 billion share repurchase program, following a cumulative buyback of over 24 million shares since late 2022. These developments highlight the company’s strategic initiatives and investor confidence in its future outlook.
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