Declining Stock and Solid Fundamentals: Is US Foods Holding Corp. Mispriced?

US Foods Holding Corp.'s (NYSE:USFD) stock has declined 6.7% over the past month, but its financial performance looks promising. The company's return on equity (ROE) is 12%, similar to the industry average of 14%. US Foods Holding's 54% net income growth over the past five years is also notable, outpacing the industry average of 8.6%. The company's high earnings retention and efficient management may be contributing to its growth.

US Foods Holding Corp. (USFD), a leading provider of fresh, frozen, and dry food products to the foodservice industry in the United States, has seen its stock decline by 6.7% over the past month. Despite this decline, the company's financial performance remains promising. The company's return on equity (ROE) stands at 12%, which is in line with the industry average of 14% [1]. Additionally, US Foods Holding has achieved a net income growth of 54% over the past five years, outperforming the industry average of 8.6% [1]. These figures suggest that the company's high earnings retention and efficient management are contributing to its robust growth.

The company's recent earnings report highlighted strong financial performance. US Foods Holding reported $1.19 earnings per share for the quarter, beating the consensus estimate by $0.05 [2]. The company's revenue for the quarter was $10.08 billion, up 3.8% year-over-year [2]. Analysts have expressed a positive outlook on the company, with Barclays and UBS raising their price targets to $95.00 and $96.00, respectively [2]. This positive sentiment is reflected in the stock's market capitalization of $17.43 billion and a price-to-earnings (PE) ratio of 33.09 [2].

US Foods Holding has also been active in expanding its product offerings and market reach. The company recently launched 18 new products under its Scoop™ brand, contributing to its $1 billion in sales for the brand in 2024 [1]. Additionally, US Foods Holding has been increasing its investment in hunger relief, culinary education, and disaster relief efforts, more than five-fold over the last two years [1].

Despite the recent stock decline, US Foods Holding Corp. continues to demonstrate strong financial health and growth prospects. Investors should closely monitor the company's future earnings reports and analyst ratings to gauge the potential for stock recovery.

References:
[1] https://finance.yahoo.com/quote/USFD/press-releases/
[2] https://www.marketbeat.com/instant-alerts/filing-corebridge-financial-inc-has-1665-million-holdings-in-us-foods-holding-corp-usfd-2025-08-26/