US Foods Holding Plunges 8.4%: What's Behind the Sharp Selloff?

Summary
• US Foods (USFD) slumps 8.4% to $77.57, erasing $7.11 from its 52-week high of $85.42
• Earnings report highlights 28% adjusted EPS growth, $250M share buybacks, and raised full-year guidance
• Intraday range spans $77.15 to $85.42, signaling volatile post-earnings reaction
• Sector peers like Sysco (SYY) also retreat, with SYY down 2.2%

US Foods Holding Corp. (USFD) has plunged nearly 8.4% in intraday trading following a mixed market reaction to its Q2 earnings report. Despite record Adjusted EBITDA of $548M and raised guidance, the stock has cratered from its opening price of $85.42 to a low of $77.15. This sharp selloff raises urgent questions about profit-taking, guidance skepticism, or sector-wide pressures in the food distribution industry.

Earnings Optimism Clashes with Profit-Taking Pressure
The selloff defies USFD’s stellar Q2 results: 3.8% sales growth, 12.1% Adjusted EBITDA increase, and $250M in share repurchases. However, the stock’s 8.4% drop suggests investors are aggressively locking in gains after the stock hit its 52-week high of $85.42 at market open. The 30-day moving average of $81.16 and 200-day average of $70.56 now bracket the stock, indicating a potential consolidation phase. Additionally, the 52.1% implied volatility on the USFD20250815C85 call option (leverage ratio 1106.29%) suggests traders are hedging against further declines.

Food Distribution Sector Under Pressure as USFD Slides Amid SYY’s Decline
The broader food distribution sector is struggling, with Sysco (SYY) down 2.2% and Performance Food Group (PFGC) trading flat. USFD’s 8.4% drop mirrors the sector’s defensive shift as investors reassess margin sustainability in a high-interest-rate environment. While USFD’s 28% adjusted EPS growth outpaces peers, the sector’s 3.39% daily decline underscores macroeconomic concerns about restaurant chain volume declines and supply chain inflation.

Options Playbook: Aggressive Bets on USFD’s Volatility
• RSI: 54.05 (neutral)
• MACD: 1.35 (bearish crossover with signal line at 1.51)
• Bollinger Bands: $80.40–$85.27 (current price near lower band)
• 200-day average: $70.56 (below current price)

USFD’s technicals suggest a short-term bounce from oversold levels but bearish momentum. Key support at $80.40 (lower Bollinger Band) and resistance at $85.27 (upper band) define a tight trading range. The 30-day turnover rate of 0.92% indicates moderate liquidity, but options like the USFD20250815C85 call (leverage ratio 1106.29%) offer high-risk, high-reward potential. Aggressive bulls may consider the USFD20250815C82.5 call (strike $82.5, delta 0.147, gamma 0.051) for a leveraged play on a rebound above $83.50.

Top Option 1: USFD20250815C85 (Call)
• Code: USFD20250815C85
• Strike: $85
• Expiry: 2025-08-15
• IV: 33.61% (moderate)
• LVR: 1106.29% (extreme leverage)
• Delta: 0.0428 (low sensitivity)
• Theta: -0.0359 (high time decay)
• Gamma: 0.0223 (moderate sensitivity)
• Turnover: 4013 (high liquidity)
• Payoff at 5% downside: $0 (strike above current price)
• Ideal for volatility traders expecting a sharp rebound.

Top Option 2: USFD20250815C82.5 (Call)
• Code: USFD20250815C82.5
• Strike: $82.5
• Expiry: 2025-08-15
• IV: 36.76% (moderate)
• LVR: 234.67% (high leverage)
• Delta: 0.1469 (moderate sensitivity)
• Theta: -0.1089 (high time decay)
• Gamma: 0.0514 (high sensitivity)
• Turnover: 547 (reasonable liquidity)
• Payoff at 5% downside: $0.75 (strike below current price)
• Best for directional bets on a $83.50 breakout.

If $83.50 breaks, USFD20250815C82.5 offers leveraged upside. Aggressive bulls may consider USFD20250815C85 into a bounce above $85.

Backtest Us Foods Holding Stock Performance
The backtest of USFD's performance after an intraday plunge of -8% shows favorable short-to-medium-term gains. The 3-Day win rate is 56.13%, the 10-Day win rate is 61.46%, and the 30-Day win rate is 66.07%. While the maximum return during the backtest period was only 7.79% over 30 days, the overall trend suggests that USFD tends to recover and even exceed its pre-plunge levels.

USFD at Crossroads: Buy the Dip or Beware the Fall?
USFD’s 8.4% selloff creates a critical inflection point for investors. While the company’s 28% adjusted EPS growth and $250M buybacks signal strong fundamentals, the stock’s collapse near its 200-day average ($70.56) raises caution. Watch for a rebound above $83.50 (30-day support) to validate the bearish selloff as a buying opportunity. Sector leader SYY’s 2.2% decline adds context, suggesting broader distribution sector fragility. For now, prioritize options like USFD20250815C82.5 for leveraged exposure or wait for a $80.40 support test before committing capital.