BMO Capital analyst Kelly Bania upgraded the rating on United Natural Foods to a Buy today, setting a price target of $36.00.
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Kelly Bania has given her Buy rating due to a combination of factors that highlight United Natural Foods’ strong performance and strategic initiatives. One of the primary reasons is the company’s effective execution of its network optimization strategy, which has resulted in better-than-expected customer retention and increased visibility into achieving its EBITDA growth targets. This strategic execution has bolstered confidence that UNFI can meet or exceed its high single-digit EBITDA growth objectives.
Additionally, despite a recent cyber breach incident, the underlying business momentum remains strong, with estimated sales growth of 6% and EBITDA growth of 17% for the fiscal year 2025. Bania’s revised target price of $36, representing a 23% premium to the current share price, is based on a 6.5x multiple of the raised fiscal year 2026 EBITDA forecast of $640 million, which is a 14% year-over-year increase. This valuation is slightly conservative compared to historical averages but reflects the company’s robust performance and strategic advancements.
According to TipRanks, Bania is a 5-star analyst with an average return of 8.0% and a 67.70% success rate. Bania covers the Consumer Defensive sector, focusing on stocks such as Dollar General, Dollar Tree, and Sprouts Farmers.