SYY

Mission Produce, Inc. AVO is slated to report third-quarter fiscal 2026 results on Sept. 8, after market close. The company is likely to report top-and bottom-lines decrease when it posts the quarterly results.For revenues, the Zacks Consensus Estimate is pegged at $333.5 million, implying a drop of 6.8% from the year-ago quarter. The consensus estimate for the company’s earnings is pegged at 11 cents per share, which reflects a decline of almost 58% from the year-ago quarter’s figure. The consensus mark has increased 57.1% in the past seven days. In the last reported quarter, the company delivered a negative earnings surprise of 85.7%. Its earnings beat the Zacks Consensus Estimate by 30.1%, on average, in the trailing four quarters. Mission Produce’s quarterly results are likely to face headwinds, primarily due to an unusually high supply of Mexican avocados that pushed prices significantly lower and pressured margins. The company also faced a mismatch between fruit availability and customer demand, which led to higher sourcing costs for in-demand sizes and lower prices for excess sizes.In addition, Mission Produce had to rely more heavily on third-party packing services as its Mexican packing capacity was stretched, further affecting profitability. The company’s International Farming business was also impacted by lower blueberry packing volumes, weaker yields from newer blueberry acreage and investments in mango production that did not deliver the expected yield improvement.Additionally, the Blueberries segment faces lower volumes due to accelerated harvest timing and unfavorable weather conditions. Lower yields per hectare have been driving higher production costs, while reduced blueberry volumes are likely to have negatively impacted packhouse utilization in the International Farming segment. Also, potential weather disruptions associated with El Nino could create production risks. Collectively, these factors are expected to hurt AVO’s results in third-quarter fiscal 2026.On a positive note, Mission Produce has been benefiting from a vertically integrated model, durable avocado demand and an expanded platform following the completed Calavo acquisition. Higher volumes continue to support category growth, while Calavo integration adds North American packing capacity, supply flexibility and prepared foods exposure. Peru production is expected to reach record exportable volumes. Such factors are likely to have offered some cushion to the company’s performance in the to-be-reported quarter. Mission Produce, Inc. price-eps-surprise | Mission Produce, Inc. Quote Our proven model predicts an earnings beat for Mission Produce this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chance of an earnings beat. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.Mission Produce currently has an Earnings ESP of +33.33% and a Zacks Rank of 3. Mission Produce has a forward 12-month price-to-earnings ratio of 17.35X, higher than the Agriculture - Operations industry’s average of 15.76X. The stock is trading lower than its median of 21.37X. Image Source: Zacks Investment Research The recent market movements show that AVO’s shares have gained 20.2% in the past three months compared with the industry's 7.3% growth. Here are some other companies, which according to our model, also have the right combination of elements to beat on earnings this reporting cycle.Sysco SYY currently has an Earnings ESP of +1.90% and a Zacks Rank of 2. The company is likely to register an increase in the top and bottom lines when it reports first-quarter fiscal 2027 numbers. The Zacks Consensus Estimate for quarterly earnings per share is pegged at $1.17, up 1.7% from the year-ago period. SYY has a trailing four-quarter earnings surprise of 1%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.The consensus estimate for Sysco’s quarterly revenues is pegged at $22.2 billion, which implies an increase of 4.8% from the prior-year quarter.Constellation Brands STZ currently has an Earnings ESP of +0.09% and a Zacks Rank of 2. The company is likely to register an increase in its top line when it reports second-quarter fiscal 2027 numbers. The Zacks Consensus Estimate for STZ’s quarterly revenues is pegged at $2.6 billion, which indicates a 3.8% rise from the prior-year quarter. The consensus estimate for Constellation Brands’ quarterly earnings per share is pegged at $3.63, remaining in line with the year-ago period. STZ has a trailing four-quarter earnings surprise of 9.6%, on average.Simply Good Foods SMPL currently has an Earnings ESP of +0.02% and a Zacks Rank of 3. The company is likely to register declines in its top and bottom lines when it reports fourth-quarter fiscal 2026 numbers. The Zacks Consensus Estimate for Simply Good Foods’ quarterly revenues is pegged at $328.6 million, which indicates a decrease of 11% from the prior-year quarter.The consensus estimate for Simply Good Foods’ quarterly earnings per share is pegged at 40 cents, down 13% year over year. SMPL has a trailing four-quarter earnings surprise of 9.2%, on average. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Mission Produce, Inc. (AVO) : Free Stock Analysis Report Constellation Brands Inc (STZ) : Free Stock Analysis Report Sysco Corporation (SYY) : Free Stock Analysis Report The Simply Good Foods Company (SMPL) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

A month has gone by since the last earnings report for Sysco (SYY). Shares have lost about 2.9% in that time frame, underperforming the S&P 500. But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Sysco due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts. Sysco's fourth-quarter fiscal 2026 top and bottom lines increased year over year and came ahead of the respective Zacks Consensus Estimate. The company ended fiscal 2026 with positive case growth across its local, national and international businesses. Supply-chain productivity, improved Sysco Brand penetration and cost-saving actions supported profit growth, while investments in sales capacity continued.Adjusted earnings were $1.53 per share, up 3.4% year over year, outpacing the Zacks Consensus Estimate of $1.51. Sales grew 4.7% to $22,124 million and beat the consensus mark of $21,921 million. Sysco’s top line benefited from positive case growth across local and national customers in the United States, along with continued international gains. U.S. Foodservice volume increased 2.5%, while local volume advanced 2.6%.Comparable sales on a constant-currency basis were $22,077 million, up 4.4% year over year. Foreign exchange added $47 million to total reported sales, including a $46-million benefit to International Foodservice Operations. Gross profit increased 3.7% year over year to $4,134 million. Growth reflected higher volumes, improved mix from increased Sysco Brand penetration, strategic sourcing efficiencies and effective management of product costs. Product cost inflation was 2.8% at the total enterprise level, primarily reflecting higher costs in meat and fresh produce. Adjusted operating expenses increased 3.6% to $2,994 million as sales headcount and capacity investments were partly offset by cost-out efficiencies.Adjusted operating income rose 4.1% to $1,140 million. Adjusted operating margin was 5.15%, down three basis points from the prior-year quarter as adjusted expense growth slightly outpaced the increase in gross profit. Adjusted EBITDA advanced 4.7% to $1,346 million, reflecting the benefit of operating productivity and continued business growth. U.S. Foodservice Operations sales increased 4.4% to $15,406 million. Total case volume rose 2.5%, while local case volume advanced 2.6%. Gross profit grew 3% to $2,958 million, though gross margin contracted 26 basis points to 19.20%. Adjusted operating income edged up 0.1% to $1,059 million.International Foodservice Operations sales climbed 6.7% to $4,191 million. On a constant-currency basis, sales increased 5.6% to $4,145 million. Gross margin expanded 12 basis points to 21.69%, while adjusted operating income jumped 15.7% to $228 million. Constant-currency adjusted operating income rose 14.7%.SYGMA sales increased 3.1% to $2,231 million. Gross profit rose 2.9% to $175 million, while operating income advanced 11.1% to $30 million despite a two-basis-point decline in gross margin.The Other segment generated sales of $296 million, up 2.8%. Gross margin expanded 273 basis points to 26.69%, while adjusted operating income increased 30% to $13 million. For fiscal 2026, cash flow from operations increased 5.1% to $2,638 million. Free cash flow rose 16.3% to $2,114 million, aided by lower additions to plant and equipment compared with the prior year. Sysco returned $1,237 million to shareholders through $1,037 million in dividends and $200 million in share repurchases. The company ended fiscal 2026 with cash and cash equivalents of $1,786 million and total liquidity of $4,800 million. Management introduced fiscal 2027 guidance, calling for sales growth of 6-7% and adjusted earnings growth of 9-11% on a 53-week basis. The outlook reflects expectations for continued positive momentum and further productivity gains. The guidance includes approximately $100 million in cost savings from AI-enabled inventory management, improved forecasting accuracy, coding efficiency, routing optimization and back-office automation. Sysco expects these initiatives and previously announced cost actions to support profit growth and operating-margin expansion. Since the earnings release, investors have witnessed a downward trend in estimates revision. Currently, Sysco has a average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. However, the stock has a score of B on the value side, putting it in the second quintile for value investors. Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been broadly trending downward for the stock, and the magnitude of these revisions looks promising. Notably, Sysco has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months. Sysco is part of the Zacks Food - Miscellaneous industry. Over the past month, Chefs' Warehouse (CHEF), a stock from the same industry, has gained 4.5%. The company reported its results for the quarter ended June 2026 more than a month ago. Chefs' Warehouse reported revenues of $1.17 billion in the last reported quarter, representing a year-over-year change of +12.9%. EPS of $0.78 for the same period compares with $0.52 a year ago. For the current quarter, Chefs' Warehouse is expected to post earnings of $0.61 per share, indicating a change of +22% from the year-ago quarter. The Zacks Consensus Estimate has changed +11.7% over the last 30 days. The overall direction and magnitude of estimate revisions translate into a Zacks Rank #1 (Strong Buy) for Chefs' Warehouse. Also, the stock has a VGM Score of B. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Sysco Corporation (SYY) : Free Stock Analysis Report The Chefs' Warehouse, Inc. (CHEF) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Sysco Corporation SYY enters fiscal 2027 with a higher growth target and a clear efficiency mandate. Management is putting artificial intelligence (AI)-enabled productivity projects at the center of a plan designed to lift earnings faster than sales. The question for investors is whether those savings can produce firmer margins while Sysco continues funding sales and distribution capacity and restaurant traffic remains soft. Execution on the $100 million cost program is therefore a key fiscal 2027 marker. Sysco Corporation price-consensus-eps-surprise-chart | Sysco Corporation Quote Sysco expects fiscal 2027 sales to grow 6-7% to approximately $90 billion. Adjusted EPS is projected to increase 9-11% to $5.02-$5.12 on a 53-week basis. The outlook represents a step-up from fiscal 2026, when sales rose 3.9% and adjusted EPS increased 3.4%. Excluding the extra week, management expects earnings growth at the high end of its long-term growth algorithm. Approximately $100 million of in-year savings is expected from AI-enabled inventory management, better forecasting, coding efficiency, routing optimization and back-office automation. The identified actions amount to about $160 million on a run-rate basis. Management said the $100 million is net of investment, with benefits expected to build through the year and be weighted toward the second half. That makes the pace of implementation as important as the headline savings target. US Foods Holding Corp. USFD, another major foodservice distributor, reported about a 2% improvement in cases per mile after completing a routing-system deployment. Performance Food Group Company PFGC, another large North American distributor, says it is integrating AI into the processes while also flagging implementation risk around new technology. Sysco's fourth-quarter results provide an operating base for the initiative. Adjusted operating income advanced 4.1% to $1.14 billion, while adjusted operating expenses fell 15 basis points as a percentage of sales to 13.5%. Routing improvements also lifted on-time delivery performance by 10 points compared with customer promise windows. Management expects upgraded routing technology and other supply-chain projects to lower the cost to serve while improving service. The plan does not assume a restaurant recovery. Fiscal 2027 guidance is built on an industry traffic environment broadly similar to fiscal 2026, when restaurant foot traffic remained down year over year. The outlook also assumes inflation of roughly 1.5-2%. If inflation runs higher or traffic weakens further, case-volume growth could slow and make Sysco's sales and margin targets harder to reach. Image Source: Zacks Investment Research Savings will also have to outrun continued spending. Sysco is investing in sales capacity and distribution infrastructure, costs that can absorb part of the benefit from sourcing, productivity and automation. Fourth-quarter adjusted operating margin was 5.15%, down three basis points year over year. For full-year fiscal 2026, adjusted operating expenses rose 5.1%, faster than gross-profit growth of 4.5%, reinforcing why cost execution matters. The fiscal 2027 setup points to faster earnings growth, but the payoff depends on converting planned AI savings into sustained operating leverage while demand remains subdued. Delivering the targets will require productivity gains to keep pace with investment and pricing pressures. SYY currently carries a Zacks Rank #2 (Buy), a favorable near-term signal tied to earnings-estimate revisions. Its Value Score of B is supportive for value-focused investors, while the Growth Score of C and VGM Score of C are middling and the Momentum Score of D is weaker. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. The combination leaves a mixed style profile around a favorable Zacks Rank. Investors focused on the AI theme may therefore want to watch evidence of cost savings and margin expansion rather than treating the guidance alone as confirmation of the payoff. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Sysco Corporation (SYY) : Free Stock Analysis Report Performance Food Group Company (PFGC) : Free Stock Analysis Report US Foods Holding Corp. (USFD) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Brown-Forman Corporation BF.B is slated to release first-quarter fiscal 2027 results on Sept. 2. The alcoholic beverage bigwig’s earnings are expected to have increased. The Zacks Consensus Estimate for fiscal first-quarter revenues is pegged at $921.2 million, indicating a drop of 0.3% from the year-ago quarter.The consensus mark for earnings is pegged at 38 cents per share, indicating an increase of 5.6% from the year-ago period’s number. Earnings estimates for the fiscal first quarter have been unchanged in the past 30 days.In the last reported quarter, the company’s earnings missed the Zacks Consensus Estimate by 63.6%. In the trailing four quarters, BF.B delivered a negative earnings surprise of 11.9%, on average. Brown-Forman has been benefiting from its premiumization strategy and strong brand investments. BF.B is advancing its pricing strategy, global expansion and revenue-growth management initiatives. The company is gaining traction from portfolio evolution, Jack Daniel's Country cocktail business model change and strong price mix.Brown-Forman is focusing on expanding its geographic presence, strengthening its core brands, accelerating innovation and premiumization, and expanding its ready-to-drink portfolio. The company is also working to improve its route-to-consumer model, streamline operations and enhance cost efficiency. In international markets, Brown-Forman is increasing distribution and scale, particularly in Japan and other emerging markets. It continues to invest in key brands such as Jack Daniel’s, while using new products, pricing, revenue growth management and targeted marketing to drive organic growth. All such aforesaid efforts are likely to have aided the company’s performance in the quarter under review. The Zacks Consensus Estimate for Emerging markets’ revenues is pegged at $251 million for the quarter under review, up 12.1% year over year.However, Brown-Forman has been grappling with a volatile operating landscape including geopolitical uncertainties and softening consumer demand. Consumer demand has remained muted across key markets, as inflationary pressures and cautious discretionary spending continue to weigh on premium alcohol purchases. The company’s results have also been pressured by portfolio-related headwinds, including the absence of Finlandia and Sonoma-Cutrer, the conclusion of the Korbel relationship and the lack of benefits from the prior-year Sonoma-Cutrer transition services agreement. Weaknesses in Jack Daniel’s Tennessee Whiskey, Herradura and Jack Daniel’s Tennessee Honey are expected to have further weighed on sales trends. These factors are expected to have hurt its first-quarter fiscal 2027 performance, with the company witnessing lower volumes across several brands and regions. Brown-Forman Corporation price-eps-surprise | Brown-Forman Corporation Quote Our proven model does not conclusively predict an earnings beat for Brown-Forman this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that’s not the case here. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.Brown-Forman has an Earnings ESP of -1.09% and a Zacks Rank #4 (Sell) at present. From a valuation perspective, Brown-Forman stock is trading at a premium relative to the industry benchmarks. It has a forward 12-month price-to-earnings of 16.54X, above the Beverages - Alcohol industry’s average of 15.05X. Image Source: Zacks Investment Research Brown-Forman shares have lost 2% in the past six months against the industry’s growth of 0.4%. Here are a few companies, which according to our model, have the right combination of elements to post an earnings beat:Sysco SYY currently has an Earnings ESP of +1.90% and a Zacks Rank of 3. The company is likely to register an increase in the top and bottom lines when it reports first-quarter fiscal 2027 numbers. The Zacks Consensus Estimate for quarterly earnings per share is pegged at $1.17, up 1.7% from the year-ago period. SYY has a trailing four-quarter earnings surprise of 1%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.The consensus estimate for Sysco’s quarterly revenues is pegged at $22.2 billion, which implies an increase of 4.8% from the prior-year quarter.Constellation Brands STZ currently has an Earnings ESP of +0.09% and a Zacks Rank of 3. The company is likely to register a decline in its top and bottom lines when it reports second-quarter fiscal 2027 numbers. The Zacks Consensus Estimate for STZ’s quarterly revenues is pegged at $2.6 billion, which indicates a 3.7% rise from the prior-year quarter. The consensus estimate for Constellation Brands’ quarterly earnings per share is pegged at $3.63, remaining in line with the year-ago period. STZ has a trailing four-quarter earnings surprise of 9.6%, on average.Simply Good Foods SMPL currently has an Earnings ESP of +0.02% and a Zacks Rank of 3. The company is likely to register declines in its top and bottom lines when it reports fourth-quarter fiscal 2026 numbers. The Zacks Consensus Estimate for Simply Good Foods’ quarterly revenues is pegged at $330.5 million, which indicates a decrease of 10.4% from the prior-year quarter.The consensus estimate for Simply Good Foods’ quarterly earnings per share is pegged at 40 cents, down 13% year over year. SMPL has a trailing four-quarter earnings surprise of 9.2%, on average. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Brown-Forman Corporation (BF.B) : Free Stock Analysis Report Constellation Brands Inc (STZ) : Free Stock Analysis Report Sysco Corporation (SYY) : Free Stock Analysis Report The Simply Good Foods Company (SMPL) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Find your next quality investment with Simply Wall St's easy and powerful screener, trusted by over 7 million individual investors worldwide. Sysco stock has gained 26.9% over the past three years, yet both the Discounted Cash Flow (DCF) intrinsic value estimate and earnings based checks still point to the shares trading at a discount to their assessed worth. With the DCF suggesting the stock may be undervalued by 43.9% and market multiples pointing the same way, the question for investors is how much confidence to place in that apparent gap. Sysco has returned 26.9% over three years, which is a solid outcome that still leaves room for debate on whether the current price fully reflects its longer term potential. Recent commentary around efficiency gains from AI driven improvements and the planned Jetro Restaurant Depot acquisition can support higher cash flow expectations. However, any integration challenges or slower than expected benefits may limit how much value ultimately flows through to shareholders. Sysco scores 4 out of 6 on our broader valuation checks. This is a mixed picture rather than a clear bargain or clear overvaluation, and you can see the detail behind that score at 4 out of 6. The issue now is whether Sysco’s current share price already reflects most of this upside, or if the discount implied by the intrinsic value and multiples still offers meaningful room for further gains. Find out why Sysco's 6.0% return over the last year is lagging behind its peers. The Discounted Cash Flow (DCF) model estimates what Sysco is worth today based on its future cash flows. For Sysco, the latest twelve month free cash flow is about $1.8b, and the model assumes that these cash flows continue to grow rather than shrink over time. On those cash flow projections, the DCF model points to an intrinsic value of about $146 per share, which implies the stock is 43.9% undervalued relative to the current market price. Jim Cramer’s recent comments about investors getting Sysco’s solid quarter "for free" fit this picture, because the current price still sits well below what the cash flows support. On this cash flow view, Sysco stock currently screens as undervalued. Our Discounted Cash Flow (DCF) analysis suggests Sysco is undervalued by 43.9%. Track this in your watchlist or portfolio, or discover 50 more high quality undervalued stocks. Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Sysco. The P/E ratio is a useful way to see what investors are paying for each dollar of Sysco’s earnings. For Sysco stock, the current P/E is about 22.3x. That sits above the Consumer Retailing industry average of roughly 20.0x, yet below the peer group average of around 34.7x. The fair P/E for Sysco, based on its size, margins and risk profile, is estimated at about 32.4x. This is above the current 22.3x level, which indicates the shares are trading at a discount relative to this framework. On this earnings measure, the market is not assigning Sysco the higher multiple that the fair value model indicates, even with recent attention on its quarter and earnings profile. Overall, Sysco stock appears undervalued on the P/E multiple when compared with the fair ratio and broader peer group. See what the numbers say about this price — find out in our valuation breakdown. Simply Wall St Narratives for Sysco extend this valuation puzzle by outlining which assumptions about Sysco's future growth, margins and earnings would need to be true for the stock to be worth materially more or materially less than the current price. Each narrative connects a specific fair value to a clear story about the company’s possible catalysts and risks, allowing you to track over time which version of events appears closer to reality on the Community page. You can add your voice to the Sysco story by posting a Narrative that sets out a number driven view on whether its recent solid quarter, AI efficiency efforts and the planned Jetro Restaurant Depot acquisition really support the current valuation. Share your case and track how it holds up as new results and updates come through. Do you think there's more to the story for Sysco? Head over to our Community to see what others are saying! For Sysco, both the Discounted Cash Flow (DCF) intrinsic value estimate and the P/E based view currently point to the same conclusion, which is that the stock screens as undervalued rather than stretched. The broader checks are mixed, so this is not a one sided call. What really decides the outcome from here is whether Sysco can translate AI efficiency efforts and the planned Jetro Restaurant Depot acquisition into durable cash flow and earnings improvements. If those execution risks prove manageable, the present discount may look like mispricing rather than a value trap. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include SYY. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Download the Complete Report Here Key Takeaways: Record revenue and improved sequential growth reinforce BOIL’s transition from commercial platform buildout toward scaled execution. BOIL reported record revenue of $1.4 million in 2Q26, up 28% y/y from $1.1 million and 11% sequentially from $1.3 million in 1Q26, a meaningful acceleration from the ~1% sequential increase reported last quarter. 1H26 revenue reached $2.7 million, up 26% from $2.1 million in 1H25 and equivalent to 59% of full-year 2025 revenue of $4.5 million. The quarter lifts BOIL’s annualized revenue run-rate to ~$5.6 million from roughly $5.0 million entering 2Q26, while BOIL continued to invest in the U.S. direct-sales infrastructure supporting larger strategic customers. We believe the combination of improved sequential revenue growth and broader enterprise activity supports the view that BOIL is moving further into the revenue-execution phase, with broader deployments and recurring consumption representing the next stage of scale. Gross margin moderated as BOIL absorbed early rollout and channel-transition costs, while commercial investment remained focused on supporting U.S. execution. Gross profit was $0.59 million in 2Q26 versus $0.62 million y/y, with gross margin declining to 42.2% from 56.3% in 2Q25 and 53.1% in 1Q26 as inventory and channel mix, early U.S. customer servicing costs, and new-market expansion weighed on profitability. Total operating expenses increased 27% y/y to $3.01 million from $2.37 million, driven primarily by a 63% increase in sales and marketing expense to $1.62 million from $0.99 million as BOIL expanded its U.S. direct-sales team, pilot activity, and customer training. G&A remained relatively stable at $1.16 million versus $1.18 million y/y, while R&D increased modestly to $0.23 million from $0.20 million. The expense mix remains concentrated on commercialization rather than product development, while management expects lower inventory costs and a larger contribution from direct U.S. sales to support gross-profit improvement as deployments scale. Commercial traction continues to broaden across food retail, fast food, and casual dining, providing multiple pathways for BOIL to scale recurring U.S. revenue. Recent progress across supermarket, fast-food and premium casual-dining customers, alongside distribution through Sysco Los Angeles, has expanded BOIL’s base of multi-site commercial activity. Product validation now spans 100+ U.S. locations, with several relationships moving beyond pilot activity into paid deployment and broader rollout. This broadening customer base strengthens the setup heading into 2H26, with location expansion, repeat orders and recurring consumption increasingly becoming the key indicators of execution. S. direct strategic accounts remain the primary growth focus, with customer validation now extending across more than 100 locations. BOIL indicated that direct U.S. work includes three large food operators collectively representing thousands of potential locations. The company has also streamlined parts of its distributor portfolio, discontinuing master-distribution agreements with Latitude in the U.S. and Ukraine and T&J Oil in Australia, while transitioning its Indian relationship with Deep Frying Solutions to a non-exclusive structure. Distribution remains an important part of the model, with 25 distributors covering more than 50 countries, but is increasingly positioned as a complement to direct selling rather than the primary commercial engine for large strategic accounts. This hybrid approach should give BOIL greater control over pricing, implementation and recurring customer economics for tier-one accounts, while continuing to use distributors for local logistics, smaller customers and geographies where direct infrastructure would be inefficient. Several strategic relationships are now moving beyond initial validation into paid deployment and broader multi-site rollout, providing early evidence of the direct-account model progressing toward recurring commercial usage. The expanded U.S. commercial organization should increasingly shift the focus from infrastructure buildout toward conversion efficiency. During its July management webinar, BOIL highlighted that the organization has grown from approximately 20 employees at year-end 2024 to ~45 currently, with most incremental hiring focused on sales, marketing and commercial execution, particularly in the U.S. Enterprise sales cycles can currently exceed six months across engagement, pilot, broader market testing and rollout, with the company targeting an average of approximately three months over time as reference customers and implementation experience accumulate. Against 2Q26 sales and marketing expense of $1.6 million, improving conversion speed and revenue productivity across the expanded organization should become increasingly important indicators of operating leverage. Customer economics remain central to adoption, with ROI complemented by operational benefits at the kitchen level. Illustrative company examples show annual net savings of approximately $8,640 per European restaurant and $9,458 per U.S. restaurant, with oil life extending from approximately 3-5 days to 21 days in the illustrated cases, while implementation requires no new equipment or material capex. Improved food consistency, easier fryer cleaning and lower waste further support adoption, which is important because enterprise rollout ultimately depends on both procurement-level economics and restaurant-level acceptance. Manufacturing capacity remains substantially ahead of current revenue, providing meaningful headroom for enterprise rollout without near-term capacity constraints. During the July webinar, BOIL indicated that existing manufacturing capabilities can support ~$100 million of annual sales, roughly 18x the current ~$5.6 million annualized revenue run-rate and materially above the >$50 million capacity previously discussed. BOIL can also add North American or other regional manufacturing as demand develops. The existing headroom is strategically important because broader enterprise conversion could translate into materially higher revenue without requiring a proportional manufacturing build, supporting stronger fixed-cost absorption as volumes scale. Operating investment remains ahead of the current revenue base, with improved gross-profit conversion becoming increasingly important to earnings leverage. BOIL reported a 2Q26 operating loss of $2.4 million versus $1.8 million y/y and a 1H26 operating loss of $4.5 million versus $3.5 million, reflecting continued commercial investment ahead of revenue scale. Net loss totaled $2.1 million, or $0.03 per share, versus $0.9 million, or $0.01 per share, although the y/y comparison was affected by approximately $1.7 million of non-cash warrant revaluation gains in 2Q25 versus roughly $0.3 million in 2Q26. As direct U.S. sales scale and gross margin improves, higher gross-profit dollars relative to the existing commercial cost base should become the key indicator of progress toward operating leverage. Working-capital dynamics reflect the timing of larger commercial activity, with receivable conversion providing an expected source of additional liquidity. Trade receivables increased to $3.1 million at June 30 from $1.7 million at year-end, due to a significant 2Q commercial shipment for which collection is expected in the ordinary course. Inventory remained comparatively stable at $2.3 million versus $2.3 million, despite the expanding commercial pipeline, suggesting the current commercial ramp has not required a disproportionate inventory build. As larger enterprise deployments scale, receivable timing and working-capital discipline should become increasingly important, while collection of the $3.1 million receivable balance should provide an additional source of near-term liquidity. The balance sheet continues to support near-term commercial execution; cash conversion is becoming more important as investment remains elevated. Cash and short-term deposits totaled $4.5 million at June 30 versus $8.8 million at December 31, while positive working capital remained $9 million and the current ratio was approximately 7.4x. Current assets totaled $10.5 million against $1.4 million of current liabilities, with shareholders’ equity of $12.3 million. 1H26 net cash used in operating activities increased modestly to approximately $4.3 million from $4.2 million y/y, reflecting continued investment in commercial scale. Importantly, spending remains concentrated on sales execution rather than manufacturing capex, while the elevated receivable balance provides an expected near-term source of cash as the underlying shipment is collected. The June 30 positive-EBITDA milestone was not triggered, leaving the $13 million cumulative-sales threshold as the principal remaining disclosed operating-linked contingent share milestone under the existing transaction structure. The 2H26 setup is increasingly centered on converting the commercial foundation into broader deployments, recurring revenue and improving unit economics. The company expects gross profit to improve as direct U.S. sales become a larger part of the mix, while key 2H26 execution indicators include expansion of the supermarket program beyond the additional 14 locations, progression of the existing ~70-restaurant casual-dining rollout, further penetration of the fast-food customer’s franchise network, additional Sysco-supported activity and repeat orders across existing deployments. With customer validation spanning 100+ U.S. locations, approximately 45 employees supporting the organization and manufacturing capabilities stated to support up to ~$100 million of annual sales, the focus increasingly shifts from building the platform toward increasing conversion, utilization and recurring revenue across the infrastructure already in place. Disclaimer: Exec Edge does not publish proprietary estimates, ratings, price targets, or investment recommendations. The valuation discussion below is illustrative only and is based on company filings, management commentary, and third-party data and estimates. It does not constitute a recommendation, price target, rating, or prediction of future pricing. BOIL continues to trade at a premium to more mature peers, reflecting its earlier commercialization stage and higher expected growth profile. Based on an enterprise value of $112 million and 2Q26 revenue of $1.4 million, or an annualized run-rate of roughly $5.6 million, BOIL trades at approximately 20x run-rate sales, down from ~33.6x at the time of our May update. This remains elevated relative to more mature restaurant-technology and food-ingredient peers, but BOIL is still an early-stage commercialization story where valuation is driven less by current revenue scale and more by the pace of multi-location rollout conversion, repeat ordering, gross-margin recovery and operating leverage as revenue expands, with valuation support increasingly dependent on revenue growth and operating leverage rather than further multiple expansion. The more relevant valuation framework is therefore revenue scaling into the infrastructure already in place. Holding the current $112 million enterprise value constant, $25 million of annual revenue would imply 4.5x EV/Sales, $50 million would imply 2.2x, $75 million would imply 1.5x and $100 million would imply 1.1x. These scenarios are illustrative rather than forecasts, but they highlight the potential for substantial multiple compression through revenue growth alone. Management indicated in July that existing manufacturing capabilities can support approximately $100 million of annual sales, materially above the current ~$5.6 million run-rate, providing capacity for enterprise conversion without requiring a proportional near-term manufacturing build. Overall, BOIL remains an execution-driven valuation story, with the recent reset lowering the hurdle for further rerating. Customer validation across 100+ U.S. locations, the ~70-restaurant casual-dining rollout, supermarket expansion and initial paid fast-food deployment provide a broader base for recurring revenue growth, while the direct-account model should improve control over rollout execution and customer economics. The key valuation drivers are now broader site penetration, repeat ordering, shorter sales cycles and recovery in gross margin from 42.2% toward the 50%+ levels achieved previously, which would improve absorption of the current $1.6 million quarterly sales and marketing base. Continued enterprise conversion, recurring reorder activity and improving operating leverage would provide increasing fundamental support for BOIL’s valuation as revenue scales into the commercial and manufacturing infrastructure already in place. Read Exec Edge’s Initiation on Beyond Oil Ltd. Here Subscribe to our Weekly Newsletter to Receive All Research Contact: Executives-Edge.com [email protected] The post Beyond Oil: Record Revenue & U.S. Direct-Sales Expansion Fuel Scaling Phase – Quarterly Update Report appeared first on ExecEdge.

After a brief post-earnings dip in Sysco Corporation (NYSE:SYY) shares,  Jim Cramer argued during the August 11 episode of Mad Money that the market completely missed the real story: a business using smart technology to expand margins and cement its dominant position. He noted: The Q4 of fiscal year 2026 performance metrics behind Sysco Corporation (NYSE:SYY) support the bullish perspective. The distributor delivered a clean top and bottom-line beat, as it posted adjusted non-GAAP EPS of $1.53, representing a 3.4% year-over-year increase, beating consensus by $0.02 despite an $11 million higher incentive compensation impact. Net earnings rose 3.8% to $551 million, while adjusted net earnings grew 2.5% to $734 million. Total revenue reached $22.1 billion, up 4.7% year-over-year and outperformed expectations by $210 million. Looking at fiscal year 2027 on a 53-week basis, the management provided strong full-year guidance, projecting sales growth of 6% to 7% and adjusted EPS growth of 9% to 11%. The management also mentioned approximately $100 million in targeted efficiency improvements driven directly by Sysco Corporation’s (NYSE:SYY) AI-powered transformation of business processes and customer engagement. Sysco Corporation (NYSE:SYY) faces some challenges noted in its corporate disclosures. The primary vulnerability comes from capital structure changes associated with mega-scale M&A. Taking on significant new debt obligations to complete the pending Jetro Restaurant Depot acquisition subjects the company’s balance sheet to strict borrowing terms and rising interest overhead, which could leave less near-term flexibility while share buybacks remain temporarily paused. At the same time, macro cost pressures continue to put pressure on the company’s profitability. Elevated fuel prices and commodity cost inflation pulled its gross margins down 17 basis points to 18.7% during the quarter. Since wholesale food distribution relies on high volume and slim unit margins, any integration hurdles or unexpected drops in restaurant traffic could quickly limit free cash flow generation. Smart money continues to maintain a substantial presence in Sysco Corporation (NYSE:SYY). According to Insider Monkey’s tracking of elite hedge funds, 61 funds held positions in the company during the first quarter of 2026, down slightly from 65 funds in the prior quarter. It is worth noting that the company’s most prominent shareholders in Q1, Harris Associates and D E Shaw increased their stake in the company by 40% and 1363%, respectively. Sysco’s short interest sits at a modest 3.63% of total float, showing that bear activity remains low. Sysco Corporation (NYSE:SYY) presents a significant case study in how a traditional distribution giant can use enterprise AI to improve margins without losing focus on core operations. While elevated debt levels from major acquisitions and commodity cost swings present real risks, the company's scale and tech-driven cost discipline provide a strong backbone. If management successfully executes its $100 million AI efficiency drive while integrating Jetro Restaurant Depot, Sysco Corporation (NYSE:SYY) could prove that legacy supply chain leaders can deliver tech-like operational momentum. While we acknowledge the potential of SYY as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: Jim Cramer Picks CoreWeave (CRWV) as the Better Buy Over IREN and Jim Cramer Sees Cheap Valuation in Becton, Dickinson (BDX) After Q3 Beat and Raised Guidance. Disclosure: None. Follow Insider Monkey on Google News.

Image source: The Motley Fool. Tuesday, Aug. 4, 2026 at 10:00 a.m. ET Vice President of Investor Relations - Kevin Kim Chair of the Board and Chief Executive Officer - Kevin Hourican Interim Chief Financial Officer - Brandon Sewell Operator: Welcome to Sysco's Fourth Quarter Fiscal Year 2026 Conference Call. We will begin today's presentation with opening remarks and introductions. I would like to turn the call over to Kevin Kim, Vice President of Investor Relations. Please go ahead. Kevin Kim: Good morning, everyone, and welcome to Sysco's Fourth Quarter Fiscal Year 2026 Earnings Call. On today's call, we have Kevin Hourican, our Chair of the Board and CEO; and Brandon Sewell, our Interim CFO. Before we begin, please note that statements made during this presentation that state the company's or management's intentions, beliefs, expectations or predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act, and actual results could differ in a material manner. Additional information about factors that could cause results to differ from those in the forward-looking statements is contained in the company's SEC filings. This includes, but is not limited to, risk factors contained in our annual report on Form 10-K for the year ended June 28, 2025, subsequent SEC filings and in the news release issued earlier this morning. A copy of these materials can be found in the Investors section at sysco.com. Non-GAAP financial measures are included in our company's -- in our comments today and in our presentation slides. The reconciliation of these non-GAAP measures to the corresponding GAAP measures is included at the end of the presentation slides and can also be found in the Investors section of our website. During the discussion today, unless otherwise stated, all results are compared to the same quarter in the prior year. At this time, I'd like to turn the call over to Kevin Hourican. Kevin Hourican: Good morning, everyone, and thank you for joining us today. I am pleased to report that Sysco delivered strong results in the fourth quarter of fiscal 2026, exceeding our expectations on the top and bottom line. Our results for the quarter beat our prior guidance for adjusted EPS and USFS volumes. The outperformance included healthy case volume growth from both local and national customers in our USFS segment and continued strong volume growth in our International segment. Our strengthening top line trends, combined with solid supply chain productivity gains, helped to drive year-over-year profit growth across each of our 4 business segments. Additionally, as we mentioned last quarter, we have launched meaningful efficiency improvement efforts powered by AI technology modernization that helped enable solid growth across operating income, EPS and EBITDA. We will speak more about these efficiency improvement efforts as we provide visibility today into our 2027 fiscal guidance. Most notable in our Q4 performance is that our business momentum accelerated on a 2-year stack basis. And as a result, we are confident to guide fiscal 2027 to 9% to 11% adjusted EPS growth. Let's jump into our business results, starting on Slide 4. From a top line perspective, Sysco delivered over $22 billion of total revenue, a growth rate of 4.7%. These revenue results reflect positive case growth across our local, national and international business units. From a bottom line perspective, we delivered adjusted earnings per share of $1.53, which was ahead of our previously communicated expectations. The quarter enabled Sysco to deliver $4.61 for the full year, above our full year guidance range. The beat performance for the year is a sign of the momentum in the business that we expect will carry into 2027. As seen on Slides 7 and 8, we have clear positive momentum in our local business, where USFS local volumes for the quarter grew 2.6%, improving 130 basis points sequentially on a 2-year stacked basis. Each month of the quarter was stronger than the prior with June being the strongest month of the period on a 1- and 2-year basis. In our USFS segment, we grew local cases 0.5% in the first half of the year, and we grew local cases 2.9% in the second half of the year. The meaningful performance step-up was driven by improved colleague retention, improved colleague productivity and targeted growth initiatives. Sysco Your Way and Perks 2.0, for example, delivered solid revenue growth. Most notably, our AI360 selling tool increases sales colleague confidence, productivity and job satisfaction. The result is that we continue to post compelling new customer win rates, along with improved customer loss rates in the quarter, while posting solid improvement in penetration with existing customers. In fact, our penetration performance in the quarter was stronger than the overall industry, proving that the AI selling tools are positively impacting colleague productivity and selling effectiveness. All told, Sysco grew our independent customer business faster than the overall industry as we exited the fiscal year. The sequential improvement we delivered in fiscal 2026 gives us strong confidence in our local business growth targets for fiscal 2027. Another proof point of our progress is evident in our Sysco Brand performance. In Q4, we delivered positive Sysco Brand mix in our local business with an increase of 30 basis points versus last year to 46.4%, driven by a focused plan of action. We are strengthening our Sysco Brand value tier assortment. During Q4, our value tier item sales growth was 4x faster than our overall book of business, and this is not cannibalizing our existing business. These are net new cases being sold to existing Sysco customers. These customers were previously buying these value-tire products from other competing distributors and not from Sysco. Getting those cases onto a Sysco truck increases our profitability. In addition to the assortment work, we are working to optimize Sysco Brand strategic pricing architecture, linking Sysco Brand pricing strategies with the ebbs and flows of national brand prices, similar to what you would experience at a retail store. While this was always our strategic intent, AI tools are helping us execute this strategy more consistently. Lastly, AI360, as I mentioned earlier, is serving up Sysco Brand conversion opportunities to our sales colleagues. Our system prompts our sales colleagues to engage their customers if an opportunity exists to save a customer money through a brand conversion. Overall, we made significant progress in Sysco Brand, and we expect mix penetration to be positive in fiscal 2027. Sysco Brand will contribute positively to our overall profitability in 2027. Turning the page to our national contract business. During our fourth quarter, our national business delivered a step-up in performance and generated case volume growth of 2.6%. The positive result was driven by growth in our health care, travel and hospitality and foodservice management businesses, partially offset by industry-wide softness in national restaurants. For fiscal 2027, we expect to deliver positive case volume growth for national contract customers despite a macro foot traffic environment that remains challenged. Foot traffic to restaurants remains down year-over-year, and Sysco is growing our business, taking share and delivering profitable growth year-over-year. We will remain focused throughout 2027 on growing our contract business in health care, travel and hospitality and foodservice management while optimizing our performance with large national chain restaurants. Moving to the middle of the P&L. Gross profit was up 3.7%, reflecting our organization-wide focus on strategic sourcing and momentum with Sysco Brand penetration rates. Sysco's adjusted operating profit improved 4.1%, outpacing gross profit and reflecting contributions from continued productivity gains within our supply chain. Supply chain expenses grew at a slower rate than revenue and gross profits. Our warehouse and delivery operations achieved our productivity targets for the year, and we increased on-time delivery performance versus customer promise windows by 10 full points in the quarter. Routing efficiency improvements have lowered our cost to serve and increased the service levels that we provide to our customers. I am thankful for the strong performance from our operations team. These hard-working colleagues and leaders are often the face of Sysco to many of our customers. This year marked our third consecutive year of delivering meaningful reduction in miles driven and improved pieces per mile. As we upgrade our routing software in fiscal 2027, we anticipate continued positive contributions to our P&L from routing efficiency while simultaneously improving the customer experience, especially for Perks customers. As we mentioned during our Q3 earnings call, we kicked off efficiency improvement efforts that have benefited the fourth quarter and will carry into fiscal 2027. The efficiency projects helped Sysco exceed our adjusted earnings per share guidance for the quarter and the year despite pausing our share repurchase program. During our guidance section today, we will talk to additional efficiency improvement activities that we are pursuing and how they will contribute to the fiscal 2027 profitability. These efforts include AI-driven business transformation. Turning to our International segment. This quarter represents the 11th consecutive quarter of double-digit adjusted operating income growth and highlights the continued strength of Sysco's global footprint, a unique competitive advantage. Our international business delivered adjusted operating income growth of 15.7%, fueled by volume growth in every international geography with local cases growing 4.5%. The continued local outperformance is being generated by expanded supply chain capacity, increased availability of Sysco branded merchandise, increased sales headcount and easier-to-use technology. Since 2022, our international team has delivered meaningful progress, and we have more than doubled adjusted operating income margins from approximately 2% in 2022 to over 4% in fiscal year 2026. There are no structural barriers that will prevent our International division from achieving the profitability profile of our U.S. business over time. Our international leadership team is performing for today while transforming the business for a stronger future. I am thankful for the leadership and performance being delivered by our international team. Now that I have provided a high-level summary of the quarter, I would like to share an update on the status of the Restaurant Depot acquisition. We are excited about the acquisition of Restaurant Depot and the bold new chapter of profitable growth it helps to unlock, a future that creates a combined company positioned to step up sales growth, be more profitable and return more value to shareholders than a stand-alone Sysco. Most importantly, we will increase our ability to help save restaurants money with a more efficient buying program and by expanding Restaurant Depot's low-cost format to 125-plus net new geographies over time. We will expand affordable options for restaurants by bringing the low-cost Restaurant Depot model to hundreds of additional communities, and we are committed to not raising prices in Restaurant Depot stores. What makes Restaurant Depot great is their compelling value offering. We will do nothing to compromise that under Sysco's ownership. In fact, we think we can strengthen it by buying together and leveraging our combined supply chain to keep costs low. Since our planned acquisition was announced on March 30, we have worked hard to communicate the strategic merits of the deal. I will not completely repeat those points today, but I would like to highlight the key themes on Slide 10. Our combined company will grow faster and will have more exposure to the most profitable segment of the business, local. Local restaurants are performing better than national chains for a host of reasons and increasing our work focus on local customers is a net-net positive for the long term. EBITDA margins of the company are expected to expand by more than 140 basis points. We plan to deliver $250 million of cost synergies through strategic procurement efforts. We will develop and launch revenue growth initiatives that are not included in the deal model. These efforts have the opportunity to exceed the value of the procurement efforts just mentioned. An example of these opportunities is leveraging Restaurant Depot stores to fulfill orders for Sysco delivery customers when the customer needs product immediately. In many instances, the Restaurant Depot store is closer to our end customer. This multichannel concept would grow our collective sales in a cost-efficient manner. We also have an opportunity to leverage the strong assortments from the 2 businesses bidirectionally to expand our offerings to the customers. Lastly, we will expand the Restaurant Depot format to harder-to-reach communities and eventually to Canada by leveraging Sysco's inbound supply chain capability. All told, these efforts enable day 1 EPS accretion, year 1 EPS accretion in the top quartile of M&A transactions and accelerating EPS accretion as our debt level is reduced and our excess free cash flow is utilized to reduce our share count and increase our dividend. We understand that reducing our debt level is a priority for investors. It is a high priority for Sysco management as well. We are 100% confident in our ability to delever quickly by utilizing the compelling cash flow generation of core Sysco. We will improve Sysco's cash flow through the AI transformation efforts I mentioned previously. And when combined with Restaurant Depot's strong cash flow, we can reduce the debt level quickly. Most importantly, the combined company will grow faster, be more profitable and return more value to shareholders than a stand-alone Sysco. These efforts are expected to accelerate Sysco's TSR into the mid-teens. In regards to deal approval, as expected, we received a second request from the FTC during the quarter. Our initial expectations for the deal to close by the third quarter of fiscal 2027 remain unchanged. This deal expands affordable food options, creates jobs and is good for restaurant operators. We are confident that the government review will conclude that the deal is positive for restaurants and for competition. Lastly, I would like to provide an update on the performance results from Restaurant Depot. We have been advised by Restaurant Depot leadership that in their most recently completed calendar quarter, their sales growth was approximately 4% and their operating margins were in line with expectations. Through half of their calendar year, Restaurant Depot is delivering strong profit growth versus prior year and compelling overall financial performance. The Restaurant Depot business will substantially increase Sysco's profitability. It will also provide a natural hedge to a softer economy as the business benefits during economic downturns. More importantly, our combined company can create customer engagement opportunities that will be unmatched in the industry, enabling us to grow our business profitably in the important local customer segment. We believe Sysco's strong finish to the year and the guidance for fiscal 2027 demonstrate a firm foundation from which Sysco will build our future together with Restaurant Depot. In my closing section today, I want to summarize the highlights of our fiscal 2027 guidance. We expect the strong exit velocity of our business in Q4 of fiscal 2026 to carry into the coming fiscal year. Our positive momentum will continue in local case growth and Sysco Brand mix. Our International division will continue to post double-digit profit growth in 2027. We expect to deliver revenue growth of 6% to 7% for the year. The revenue growth will be enabled by approximately 2.5% local case growth in our USFS segment. Through disciplined margin and expense management, we expect to deliver adjusted EPS growth of 9% to 11% in 2027. To be very clear, the revenue and EPS figures just mentioned include the benefits of the 53rd week. Excluding the 53rd week, we expect Sysco's earnings growth to be at the top end of our long-term growth algorithm even with the suspension of share repurchases and the softer macro backdrop. When coupled with our industry-leading dividend, we anticipate a year of double-digit TSR in fiscal 2027. To enable the earnings guidance just referenced, our team introduced an organization-wide efficiency improvement program driven by AI transformation. A summary of these efforts can be seen on Slide #11. We have identified AI growth and business efficiency improvement projects across sales, merchandising, supply chain and back office. We expect the combined benefit of these efforts to deliver approximately $100 million of in-year savings in fiscal 2027, inclusive of the cost-out savings we shared on our Q3 earnings call. Brandon, our technology leadership team and I are leading this work across the company. The $100 million we have identified is just the start of the effort. We expect to announce our multi-year operating margin expansion commitment from these efforts later this year. The opportunities are significant and exciting. We believe we can improve service to our customers, do our work more efficiently and reduce our structural operating expenses by leveraging best-in-class technology. Sysco is leading our industry in these efforts, and this work will enable us to sustain and expand our industry-leading profitability. The combined impact of our core business momentum and the AI business transformation, we expect will deliver adjusted earnings per share growth of approximately 9% to 11% while improving service to our customers. With that, I would now like to turn the call over to Brandon to provide additional insights into our Q4 performance and guidance for fiscal 2027. Brandon, over to you. Brandon Sewell: Thank you, Kevin, and good morning, everyone. At the highest level, I am encouraged that we were able to over-deliver on our previously communicated guidance for the quarter and the year. As Kevin outlined, our company specific initiatives drove tangible results across our business. We expect this positive momentum to continue in FY '27, anchored on operational rigor, inclusive of our cost savings program. We have a high degree of confidence for delivering our FY '27 guidance across the P&L, cash flow and rewarding our shareholders with another year of dividend growth. As shown on Slide 13, our Q4 results included sales growth of 4.7%, continued volume growth in the USFS and International segments, strong margin management and adjusted EPS of $1.53. As Kevin stated, this allowed us to exceed our annual EPS guidance, delivering $4.61 of adjusted EPS, even after pausing share repurchase for the year. Importantly, our largest and most profitable USFS segment continued to deliver balanced top line growth during the quarter while also growing adjusted operating income. Our financial results also included free cash flow growth of 16.3% for the year. Q4 benefited from positive operating leverage for the enterprise with a 3.7% rate of growth in gross profit, outpacing a 3.6% rate of growth in adjusted operating expense, which included global pressure from the higher fuel prices. This performance also reflects continued positive volume growth across our important local customers and positive mix shifts from our Sysco Brand penetration rate. Performance in local continued to be driven by sales colleague retention, particularly among our newer and mid-tier associates, which helped to drive incremental improvements in productivity rates. Additionally, volume trends included a step-up in growth from our national customers in the U.S. and continued volume growth in our International segment. Our supply chain continued to deliver productivity improvements and performed at an exceptional level, as Kevin highlighted. We expect further positive momentum and growth across local, national and international volumes in addition to progress in supply chain, driving compounding productivity gains in FY '27 and beyond. Turning to International, as shown on Slide 15, the positive momentum over the past few years continued in Q4, with sales growth of 6.7%, including local case growth of 4.5%, gross profit growth of 7.3% and adjusted operating income growth of 15.7%. Our strategy drove results with this quarter, marking our 11th consecutive quarter of delivering double-digit improvements in adjusted operating income. During fiscal 2026, we rewarded our shareholders by paying out $1 billion in dividends and repurchasing $200 million in shares. Now let's discuss our performance and the financial drivers for the quarter. Starting on Slide 13. Our enterprise sales grew 4.7%, driven by growth across all segments. Total U.S. Foodservice volumes increased 2.5%, reflecting both local and national volume increases of 2.6%. Sysco produced $4.1 billion in gross profit, up 3.7%, partially offset by a 17-basis point decline in gross margin to 18.7%. Our teams continue to effectively manage product cost inflation across our category basket, delivering improved gross profit per case performance. Gross margin performance was in line with our expectations for the quarter. However, there were 2 factors that affected year-over-year comparability. First is to call out that in our prior year 2025, we realized outsized single quarter benefits from our strategic sourcing initiatives. The timing of those benefits was unique to that period and created a challenging comparison. The second factor was in Q4 of this year related to the increased cost of fuel across the business. Approximately 80% of our bulk fuel purchases are hedged over the next fiscal year. During the quarter, elevated fuel costs impacted both food input costs and inbound transportation expenses. We've been very thoughtful about what portion of that increase we absorb in our business to keep our food affordable for customers. Our 2027 plan takes this backdrop into account. And importantly, we are confident we can expand our gross profit margins in the coming year. During the quarter, inflation rates for the enterprise were approximately 2.8%, while inflation in our USBL business was approximately 1.3%. Overall, adjusted operating expenses were $3 billion for the quarter or 13.5% of sales, a 20-basis point decrease from the prior year, reflecting strong operating leverage within our business. Results included cost-out efficiencies, partially offset by planned investments in the business across sales headcount, fleet and building expansions. This also included lapping of $11 million in incentive compensation from the prior year. Additionally, SYGMA results this quarter were solid, reflecting 3.1% sales growth and 11.1% operating income growth, driven by continued improvement in our supply chain operations. Corporate adjusted expenses were down 9.8%, which included benefits from the previously discussed cost-out efforts implemented earlier in the year as well as lower insurance and other costs. Overall, adjusted operating income grew 4.1% to $1.1 billion and adjusted EBITDA grew 4.7% to $1.3 billion. Let's now turn to our balance sheet and cash flow. Our investment-grade balance sheet remains robust and reflects a healthy financial profile. We ended the quarter at a 2.7x net debt leverage ratio. Turning to our cash flow. Our free cash flow for the year was $2.1 billion, up 16%, highlighting strong quality of earnings and a disciplined CapEx strategy. Building on Kevin's commentary related to the merits of the Restaurant Depot transaction, I would like to provide an update on the deal financing strategy. In June, our finance team executed an additional $2 billion of interest rate hedges, further stepping up our cumulative hedge position related to debt financing. Then in July, we filed our registration statement on Form S-4, which was subsequently declared effective by the SEC. In preparation for this transaction, we remain focused on preserving cash levels, improving our core Sysco working capital and remain committed to quickly delevering the balance sheet as illustrated on Slide 23, consistent with prior communications. We know how important debt reduction is to our investors, and it is important to our leadership team as well. To that end, our team has already voted to add structural cost-out to our long-term equity performance program. That structural cost improvement will be leveraged to accelerate our debt reduction efforts and increase Sysco's overall profit margins. Kevin and I are excited about that work, and we are partnering with our technology leadership team to improve the efficiency of how we work. These projects are tangible, real and meaningful contributors to our future growth and performance. Kevin and I consistently emphasize that these efforts not only reduce administrative costs and complexity but also improve the customer experience by enabling our teams to spend more time driving growth and engaging directly with customers. Now I would like to share with you our expectations for FY '27, as seen on Slide 24. To be clear, all elements of our fiscal '27 guidance reflect the core Sysco business on a stand-alone basis and are inclusive of the 53rd week. During FY '27, we expect reported net sales growth of approximately 6% to 7% to approximately $90 billion. These assumptions include volume growth, inflation of approximately 1.5% to 2% and approximately 2% related to an extra week. Specific to volumes, we expect to deliver year-over-year local case growth of approximately 2.5% in USFS, driven by continued productivity gains with sales professionals based on improving tenure. As Kevin mentioned, we are also announcing $100 million in-year cost-out, inclusive of the cost-out announced in Q3 as detailed on Slide 11. On a run rate basis, this represents cost-out of approximately $160 million. This financial guidance assumes a macro and industry foot traffic environment similar to conditions of this past year. If conditions improve or should our cost-out savings efforts overdeliver, this would represent potential upside to our plan. All in, we currently expect full year 2027 adjusted EPS in the range of 9% to 11%, equating to adjusted EPS of approximately $5.02 to $5.12. Within the context of the current environment, our outlook reflects the midpoint of the guidance range of approximately 10% growth, which is a significant step-up relative to each of the prior 2 years. To help with phasing for the year, we expect our cost-out benefits to build with the most significant impact occurring in the second half. From a year-over-year comparability perspective, Q1 of FY '27 is lapping an approximately 4% benefit from a favorable effective tax rate in the prior year. All in, we are comfortable with an adjusted EPS range of $1.18 to $1.20 for Q1. For the year, we expect our USFS segment to deliver profit growth. We also expect our International segment to continue delivering double-digit profit growth for the year. We remain on target for shareholder returns through approximately $1 billion in dividends. Specific to our dividend, our Board of Directors previously approved a $0.01 increase to our April dividend, which represents approximately 2% growth in our quarterly dividend on a go-forward basis to $0.55 per share. Recall that we previously suspended our annual share repurchase efforts as part of the announced JRD transaction. We look forward to resuming share repurchase efforts after successfully reaching our previously shared deleverage targets. Now turning to a few other modeling items. For the full fiscal '27 year, we expect adjusted corporate expenses of approximately $900 million, adjusted interest expense of approximately $675 million, adjusted other expenses of approximately $50 million, a tax rate of approximately 23.7% to 24.2% and adjusted depreciation and amortization of approximately $850 million. CapEx to remain at approximately 0.8% of sales or $720 million. Looking ahead, we are confident that our company-specific initiatives will continue to drive positive momentum into fiscal 2027. Combined with the advantages of our industry-leading scale and capabilities, we are well positioned to accelerate customer growth while delivering long-term value for our shareholders. With that, I will turn the call back to Kevin for closing remarks. Kevin Hourican: Thank you, Brandon. I appreciate all that you were doing for Sysco, our shareholders and our customers. Q4 was a quarter displaying momentum and progress at Sysco. We are confident in our continued progress in fiscal 2027 as we plan to deliver solid revenue growth and adjusted earnings per share growth at the high end of our long-term growth algorithm. We are proud of our Dividend Aristocrat status and 57-year track record of dividend increases. For fiscal year '27, we expect to deliver a double-digit TSR. Our U.S. business is performing. Our International segment continues to exceed expectations. We are working diligently on the Restaurant Depot acquisition. I would like to thank all Sysco colleagues for their dedication to our customers, the strong finish to our fiscal year and the compelling engagement that they are bringing to our customers. Confidence and momentum are building across the company, and I've never been more excited about the opportunities ahead for Sysco. With that operator, we're now ready for questions. Kelly Bania: Kevin, I wanted to ask about the incremental cost savings related to the tech and AI initiatives. Slide 11 was helpful as you called out. Just as you look at those 6 areas of focus there, are all of these kind of equal contributors? Does one area stand out as the largest contributor to that outlook? And I think there was a comment that this is really just the start of this initiative. So just curious, it sounds like it's early, but just what does the runway look like in future years? Because the message that I'm hearing is that it can essentially replace the EPS impact of, kind of, losing the buyback impact of this year. So just curious what kind of that algorithm might look like in future years as you, kind of, incorporate these savings into the next couple of years? Kevin Hourican: Why don't I toss to Brandon to get started to set the context of the financial elements of what you just asked, what flows through to '27, our thoughts for the future. You asked about is it evenly distributed or some bigger hit topics. And so he'll cover a couple, and then he'll toss to me, and I'll do a wrap-up. So Brandon, over to you, please. Brandon Sewell: Yes, perfect. Yes. I think for '27, I'll address first, I'll give a couple of examples. From a timing perspective, that $100 million in the tech savings, it is net of investment. It will start towards the end of Q1, and it will be back half weighted as we implement the technology across those work streams that you see on that slide. I should also say it will be weighted towards USFS. Maybe I'll share a couple of examples from my shop and then, Kevin, you can add anything you'd like that would contribute towards that $100 million. The first one I would share is tech to improve fill rates and inventory forecasting accuracy. It will benefit our working capital. As a reminder to the team here, a day of working capital is worth a couple of hundred million. So we'll use those improvements to deleverage faster than we've previously shared, and that's a body of work we're really excited about. The second example I would share is related to our indirect space, not a space that generally gets a lot of attention, but we will use reverse auction tools to tackle that indirect expense, and it's significant. We buy a lot of indirect and supplies and parts with our fleet and our warehouses, and that tech will allow us to work faster and really address more than we've been able to address historically. So those new capabilities are worth tens of millions and will ramp throughout FY '27. Kevin, any projects you want to add? Kevin Hourican: Yes, I will. Just before I go into projects, let me just take a giant step back. We've been hard at work at this subject for the past, let's call it, 100-plus days evaluating every part of our business. And the mantra that I'm using as the leader of the company is better, faster, cheaper. Where can we improve the customer experience through improved technology, where can we do the work, we do faster, more agile, solve problems more quickly. And the last is do it more efficiently. We can eliminate administrative tasks, allow our team to spend more time on sales activities, allow our team to spend more time with customers to grow the business. So better, faster, more efficient. Brandon gave some good examples on back office. I'll give a couple of other examples. Routing, we're doing a massive effort on upgrading our routing software. To be very, very clear, it's our existing routing software provider upgrading to their latest version of their software. It has capabilities that the current version we have does not have. We will be deploying that to all of our U.S. locations eventually internationally. But it's more than the software. It's about changing how we do that work. It's about customer-centric routing capabilities, doing that work in a more agile manner, decreasing miles driven while simultaneously increasing our on time to the delivery promise to the customer. That's a perfect example of better and more efficient. The routing opportunity is significant. Another one is tech for tech, leveraging coding improvement technologies, I won't say the name of vendor providers to do the technology work that we do better and more efficiently. We can either do more for the same or we can do the same amount of work we currently are doing for less spend. Last example for me is in our contract bid business. We have many, many thousands of contracts. We can leverage AI technology to write better contracts, contracts that have a better profitability profile. And then we can, more importantly, leverage technology to match the transactional actual performance of that customer against the contract to make sure that we're paying appropriately for the work that we're doing or getting paid appropriately for the work that we're doing. There can be some leakage in that sector over time if those contracts aren't being managed appropriately. So these are just examples. I think we've given you enough color to say there's tangibleness, there's clarity. And to answer the first part of your question, this will build over time. So the $100 million is net of investment as it will flow directly to the bottom line in 2027. Brandon quoted the run rate value is $160 million of the work we have already identified. We continue to find new sources of value. We will continue to revise and update the savings opportunities. That number will go up over time, and that's something we can talk more about at upcoming investor opportunities. And yes, it more than covers the pausing of the share buyback. Thank you for the question, Kelly. Edward Kelly: I have a follow-up and then a separate question. But just a follow-up on Kelly's question. I think your supply chain costs alone are probably 60% or so of your OpEx. I mean that's like $7 billion. So the $100 million seems like it's, kind of, scratching the surface. Kevin, my question for you is, do you think that longer term, the opportunity here could be a catalyst to accelerate the algo? Or is it more or less this is one of the levers that we continue to have to drive confidence in the algo? And then my real question is around the U.S. Broadline EBIT growth for '27. Obviously, coming off a little bit softer Q4. Could you just maybe give us a little bit more color on the building blocks of the growth in '27 and the key drivers and how you think about the level of that growth? Kevin Hourican: This is Kevin. I'll start on the supply chain and what we see as the opportunity for the AI work to impact our algorithm. Brandon will cover the USFS question. He can explain also in Q4, some of the why it was in his prepared remarks, but he can reinforce 2 things that were unique about Q4 and then more importantly, talk about why we're very confident USFS will grow profit year-over-year throughout 2027. But back to your first question in point, we have tangible specific concrete work we're going to do with AI to be better and more efficient in how we do the work. Routing is significant. It is a huge opportunity for continued improvement. We just had a really good year in supply chain. Back to the year we just wrapped up was our strongest supply chain performance in a very long time. It positively contributed to our P&L at large. We grew our supply chain expenses lower than we grew our revenue and our volume in cases. Therefore, it had a positive impact, and we believe that will accelerate in the coming quarters and years with the good work that we are doing. And on this morning's call, we're not going to change our long-term algorithm. What the year ahead shows is that net of the 53rd week. So take that out, the guidance that we have provided today at the midpoint is at the very high end of our long-term algorithm. How I would say it is the work we're going to do with AI, the compounding nature of the efficiency improvement will allow us to be at that high end of the algorithm that we've put out on an ongoing basis. And if there's an opportunity to beat it, as Brandon said, by doing even more work than we have got line of sight to today, we can talk about longer-term revisions to the algorithm over time in the future. So let's come back to your question on USFS and profitability. Brandon, over to you. Brandon Sewell: Yes. Maybe I'll address first Q4, Ed, your question related to the margins and then let me give some commentary on FY '27 and how we're feeling specifically about USFS. There were a couple of items in Q4 on a year-over-year perspective that affected our margins. The first was going back to FY '25, if we go to Q3, strategic sourcing was low and that value was pushed into FY '25, Q4. So the year-over-year lap for '26 Q4 was challenging because of that huge strategic sourcing number in FY '26 -- FY '25, Q4. The second item is fuel. Remember, 80% of the fuel we purchase is hedged. With that, inbound freight costs due to fuel were elevated, and we don't hedge that inbound fuel. With the inbound, we monitored it during the quarter, and we made purposeful choices to absorb some of that cost. So we'll continue to show discipline there and manage our costs and our profitability. I'd say the second point on fuel is on outbound. We've mentioned this before that we have fuel surcharges in place, and there is always a lag of 90 days with our contract customers that FY '26 Q4 cost then gets paid for in FY '27 Q1. So that pressure will ease a bit as we head into FY '27. And then the second part of your question, how does all of that kind of lead into FY '27 USFS profitability? Well, I mentioned it will ease up a bit as we go into '27. A couple of other things that will take place in '27. The $100 million in cost savings that I just talked about, and Kevin talked about will lean USFS. So that will help as we ramp those tech projects throughout the year. The other component that we were really satisfied with in Q4 was our Sysco Brand. It was 30 basis points positive. That continues to grow and accelerate. So that will be a bigger contributor now that it has turned positive. Obviously, we'll have a full year of local sales growth in FY '27. And then you talked about supply chain a little bit. That's our core operations, and it performed really well in Q4. We've doubled our retention rates with our drivers and selectors since FY '24, but we feel that we have further opportunity to continue those OpEx improvements in FY '27. So overall for USFS, we expect to deliver strong profit growth, and we're optimistic about the year. Kevin Hourican: To put a bow around what Brandon just covered, it's the aggregate of those components that gives us the confidence to deliver profit growth in USFS and the exit velocity of June and the exit velocity of Q4 is where we need to be. There's no big step-up with the exception of the $100 million cost-out, which throttles throughout the year because these are projects that launch. The core business is performing. And last but not least, tied to that, one of the projects that Brandon covered is improving our forecast accuracy in the inventory space. We have a dual mandate there of improving fill rate outbound to customers he quoted, it's $250 million of cash that we can improve by taking a day of inventory or working capital day of inventory improvement to the degree that we succeed on that project or exceed expectations, we will take all of that cash to plow towards delevering faster. That is our commitment. The incremental cash flow that we generate will be targeted towards delevering faster ahead of schedule versus what we communicated on March 30 for the deal model. We understand how important delevering is to our investors. It's very important to Sysco. Lauren Silberman: I have a follow-up to Ed and then a real question. The follow-up is just on the USFS gross margins, the comment on inbound fuel. Is the right read that you're not passing it fully through pricing lower potentially to gain new customers? Or is this more of a timing dynamic? And then my real question is on case growth. So U.S. local case growth, you're guiding to 2.5% for the year. Any color on, like, what you're seeing quarter-to-date and how you're thinking about the cadence of growth? And then any more color on expectations on the national side? Kevin Hourican: It's Kevin. Let me just -- it can be confusing, fuel, what's hedged, what's not hedged. Brandon covered some key points. Let me repeat some of the key points that he made. Outbound customers, we are substantially hedged for more than a year. We have a good program. We have with key customers fuel surcharges that are in place that flex up and flex down based on cost economics. What he highlighted is one of the reasons for gross margin pressure in Q4 was inbound. For some of our suppliers, they manage the transportation, Lauren. So it's built into the cost to us on the product, so it shows up in our margin rate. And we did see increased costs on inbound fuel for the fourth quarter. To be clear, we have modeled that for all of 2027. So the guidance that we have put forward for '27 includes the "environmental conditions of Q4." So this is not something that should be a pressure point. It's built into our guidance for '27. Brandon's words were we make purposeful choices on the cost of our product to be priced competitively in the market. So we didn't make an intentional decision to lower price to take share. It's we need to be competitive in the market on the price of our product to our outbound customers and fuel increases, that can apply some short-term pressure on the margin rate, something that we are confident we have a plan to address for 2027, as I said. So that's the answer on the inbound fuel. We make purposeful choices on what we absorb and what our market competitive pricing outbound to customers needs to be. For local, we said approximately 2.5% growth through the year. That should be reasonably consistent throughout the year. There's no quarter that has big step-up requirements. The exit velocity of Q4 was strong. We're off to a good start in July. So quarter 1, period 1, off to a good start and pretty consistent steady growth throughout all of fiscal 2027. For national, we didn't quote a specific number. Here's what I would say for national, we'll continue to see strong growth in the national segment in health care, education, food service management. We expect to see continued pressure with national restaurants given traffic declines to that segment and the overall pressure that national customers, restaurant customers specifically are experiencing. Net-net, when you put that all together, we will deliver volume growth in national throughout 2027. John Heinbockel: Kevin, can you talk about the 2 biggest opportunities it looks like in local case growth, right, or the loss rate that you referenced, which still, I think, is above some of your peers. So the opportunity to bring that down and how fast you can do that? And then secondly, lines per account, right? I think you're referencing penetration has picked up a little bit. Is that just sort of green shoots here? And what you think the opportunity is and how fast that can develop? So those 2 areas. Kevin Hourican: New, loss, pen. So we're very pleased with our new customer win rate. We'd like to sustain that performance. We don't need to see improvement there. We want to sustain new. It's performing at an exceptionally high level. We want to keep that action in place. Loss rate, you're right. We've made meaningful improvement in loss over the past 12 months, and there's additional progress that can be made. Brandon talks a lot about this. Our colleague retention improvement and the increased tenure of our existing colleagues is showing up with improved customer retention. So our loss rate improved year-over-year, and there's additional opportunity for that loss rate to continue to improve. And the widening spread between new and loss will contribute to case growth. Penetration, if I look back to Q4, is actually where I was most pleased. We made substantial progress on penetration with existing customers. AI360 people ask me all the time, Kevin, how are you measuring it? Is it real? Is it showing up in your P&L? The improvement that we are driving in penetration is obviously tied to our colleague success and productivity, improved retention, improved productivity. But what AI360 is doing for that sales colleague, whether or not they're 1 year in job or 20 years in the job, is teeing up opportunities for existing customers to sell more products to that customer. It's identifying things that should be on the order that are not. It's preapproving pricing for that incremental line, incremental case. It's identifying through data what should be able to be sold and it's prioritizing it into no more than 3 things to be done that day. We can track who of our colleagues are actioning against these opportunities. We can track close rate by colleagues. Our sales leadership team is doing a phenomenally good job of coaching our colleagues based on this powerful information and data and knowing close-rate person A versus B. And John, that's showing up on solid improvement in penetration. The exit velocity of our Q4, we're taking share versus the industry, and our penetration performance in Q4 was stronger than the overall industry. And these are trends we expect to continue into 2027, which is why Brandon and I have confidence to guide at the high end of our long-term algorithm. Brandon, anything to add? Brandon Sewell: Yes. Maybe just one thing just to nail down those themes across the tenure of the colleagues, the penetration improvement and then John, seeing similar results across our geographies. The one word I think of is consistency. If I had to use that one word of Q4 local volume in terms of the month-to-month pattern that we're seeing even into P1, we're trending using that consistency into FY '27, which is really encouraging to us. John Ivankoe: I know there's been attention in private label, and we're seeing that in results now at Sysco. And I wanted to just get, I guess, a little bit more color in terms of where you're seeing success and where you're seeing opportunity, whether some highest end in premium, I guess, the kind of core and classic or Reliance, which I think is kind of in terms of packer brands, maybe a newer initiative for you. And the opposite of private label versus maybe related but in a different way, is how your salespeople are selling some of Sysco's specialty businesses, particularly on the meat side, on the produce side, on DON cleaning supplies, what have you, different types of Asian products, the success that your broadline salespeople have had of integrating specialty into their broadline type accounts. Kevin Hourican: We're pleased with the progress that we've made in Sysco Brand, the positive 30 basis points on a year-over-year quarter-to-quarter perspective is a strong statement of the initiatives that we have deployed in Sysco Brand that will carry into 2027, which to repeat our guidance for '27, we expect for Sysco Brand to be positive throughout 2027. It started first with product. As I've mentioned previously, we had void in the Reliance to answer your question, product offering, which for others is the opening. We have good, better, best. It's the good product offering that we have. We've started at the item level, where do we not have matches to packer label or to national brand where we can introduce those opening price point products or good products to our customers. That is detailed work. It takes time to get the supplier relationships to audit their factories to ensure that the product is meeting our quality specifications. And that work has been underway now for over the past year, and we saw solid improvement in our value tier revenue growth. In fact, I said on the earnings call, 4x growth of the overall book of business, and it is not cannibalizing better, best products. These are items that simply were not being bought. We can target specifically which customers are being propagated to for these offers, both through AI360 for the sales colleague and also on our website. So it started with product. Topic 2 is pricing architecture. As I said on the call, we always have the intent for Sysco Brand to be a value for the customer, AKA save them money. We have lots of items. They ebb and flow with the cost of product going up and down over time. And leveraging AI technology, we're doing a better job of ensuring that the price architecture to the customer shows consistent value to our customers over time. That helps. That improves our sell-through performance. Last but not least, one of my favorite app capabilities within AI360 is something we call Swap & Save, which is if a customer from a sales rep has the opportunity to save the customer money, it prompts them in row 1 of AI360, introduce the savings opportunity to your customer today. And this is new. It was launched within the past few months. It is having a tremendously positive impact and reaction from our sales colleagues. Our colleagues make more money when they sell those cases. But putting it right in front of them, giving them confidence that it is a legitimate sub to that national brand product. If they want to learn more about it, they can click a video and learn about the product and learn about the item, et cetera. Progress, and we expect for that progress to continue. Your question about our specialty business is a great one. We call that total team selling. While I didn't have it in my prepared remarks, Total team selling continues to make progress at Sysco, and it's across our produce business, our protein business. And as you indicated, our equipment and supplies business, Asian foods businesses as well. We will expand our Asian food business to more geographies in 2027, giving us more of an opportunity for that cross-sell capability. Total team selling continues to perform. There continues to be meaningful opportunity for us. We still have many, many thousands of customers who are buying just broadline. And as we've shared before, as we add a specialty category to that account, that customers buy more, they have a much higher retention rate and a higher overall profitability. So total team selling continues to perform the company for the company and will be a growth vector for 2027. Mark Carden: So it sounds like some good progress on local case volumes. How are you thinking about local salesperson's headcount growth in fiscal '27? Any acceleration or deceleration relative to fiscal '26? And then when you do see macro pressures like the ones that we're seeing persist, do you see much of a benefit from having a more balanced base bonus structure relative to your peers? Kevin Hourican: Brandon, do you want to start this question? Brandon Sewell: Yes. So from a hiring perspective, we had 450 in '24. We talked about 300 in '25. And in '26, we did have growth across both of our main U.S. businesses. Those we've hired over the last 2 years have moved up the productivity curve. And retention remains high across all of those tenures. Mark, we'll continue to hire salespeople for sure. We're at a point where we're balancing that with productivity. We're seeing significant productivity improvement. So we want to strike the balance between those 2, but we will absolutely have better or more growth in FY '27 as well. And then from a macro perspective, we have -- we've included all of those pressures in our FY '27 guide. As an example, going back to fuel expenses, we modeled fuel expenses to be similar to what we saw in on-highway diesel prices from Q4. When we look at the international space, they're under pressure as well due to the geographical nature of it, but we're moving forward. We just had our 11th quarter of consecutive double-digit OI growth, and we expect that to continue throughout FY '27. So we parked all of those components into our guide, and we feel like we'll have a robust year despite the macroeconomic pressures. Brian Harbour: I don't know if you're willing to answer this, but just the questions that have come up as part of the FTC review process for Restaurant Depot, is that -- what's the nature of those? I guess, have those been largely as you expected at the outset here? Kevin Hourican: The questions are as we expected. And if I could just step back to the bigger picture. We have confidence that the deal will get approved. We've said on today's prepared remarks by our Q3. The fact that the government will see when they review the case file is that these are independent customer channels that a customer is a cash-and-carry customer. They choose that channel, that is where they shop, and there is meaningfully ample competition within Cash & Carry. You've got Costco, you've got Sam's Club, you have thousands of independent cash and carry operators. Two of our competitors operate cash and carry channels as well. So there's meaningfully ample competition in Cash & Carry. The other customer is a customer who prefers delivery. They want white-glove service. They want a delivery to their restaurant. They don't want to own their own van and have to take time out of their day to have to go over to a store to get their product. And obviously, there's ample competition in the delivery. There's very little overlap between the 2 customer channels today at this time, and that can be back tested looking at when Restaurant Depot opens a store, what happens. That's point one. Point two is pricing. They're going to look at, will this deal negatively impact the end restaurant customer. And I cannot be more clear on this topic. We at Sysco have no intention to raise prices at Restaurant Depot stores. As I said in my prepared remarks, we actually think we can improve affordability. How we will do that is by bringing their model to 125 net new geographies that create many thousands of jobs. It brings the affordable low-cost leader to net new communities, and that's a positive for restaurants. And stores that are operating today, we have no intention of raising prices at those stores. It would hurt the stores. It would decrease their competitiveness and the value that they're providing to their end customers who would have no economic incentive to do that. So we are answering all the government's questions. It's a big deal, meaning the deal is a large transaction. They have to go through their data discovery, and we have confidence that the facts will result in the deal getting approved, as we said, by Q3. What we're most excited about is being able to buy product together sharing in that procurement efficiency to produce value for our end customers, bring their model to net new geographies and eventually up to Canada. There isn't a strong top-performing cash and carry operator up north, and we really believe that going to Canada is a compelling opportunity for the long term. And last but not least, eventually, at the appropriate time, while today, they're separate channels, we have an opportunity to serve customers more effectively. And my favorite example is a delivery primary customer who runs out of something between deliveries and needs it urgently. We at Sysco today have limited options to be able to support that customer's needs. Oftentimes, the Restaurant Depot store is going to be closer to that customer and our ability to leverage that store for rapid same-day delivery is something we're very excited about, and we know customers will benefit from. So thank you for the question. Kevin Kim, over to you. Kevin Kim: All right. Great. Thank you, everybody. Thank you for joining our call today. Please reach out to the Investor Relations team if you have any follow-up questions. Thank you for your time. Operator: Thank you, ladies and gentlemen. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect. Before you buy stock in Sysco, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Sysco wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $411,427!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,335,252!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 11, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has positions in and recommends Sysco. The Motley Fool has a disclosure policy. Sysco (SYY) Q4 2026 Earnings Call Transcript was originally published by The Motley Fool

Interested in Sysco Corporation? Here are five stocks we like better. Sysco exceeded its fiscal 2026 expectations: Fourth-quarter revenue rose 4.7% to more than $22 billion, while adjusted EPS reached $1.53 and full-year adjusted EPS totaled $4.61. U.S. local and national case volumes each increased 2.6%, supported by stronger customer growth and productivity initiatives. Management issued a positive fiscal 2027 outlook: Sysco expects 6%–7% sales growth, 2.5% U.S. local case-volume growth and 9%–11% adjusted EPS growth to approximately $5.02–$5.12. The forecast includes a 53rd week and about $100 million in in-year cost savings from efficiency and AI-enabled projects. The Restaurant Depot acquisition remains targeted for fiscal Q3 2027: Sysco expects the deal to generate $250 million in cost synergies and expand Restaurant Depot into more than 125 additional geographies. The company is preparing to preserve cash and accelerate debt reduction following the transaction. 3 Defensive Stock Alternatives to Bonds If Interest Rates Drop Sysco (NYSE:SYY) reported fourth-quarter fiscal 2026 results that exceeded its prior expectations for adjusted earnings per share and U.S. foodservice volumes, citing accelerating local customer growth, supply-chain productivity gains and early benefits from efficiency initiatives. Chief Executive Officer Kevin Hourican said the company generated more than $22 billion in quarterly revenue, up 4.7% from the prior-year period, while adjusted earnings per share reached $1.53. For the full fiscal year, Sysco reported adjusted EPS of $4.61, above its previously provided guidance range. → No Hangover: Revisiting Microsoft One Week After Earnings Today’s market could make Sysco stock break out, will it? “Our business momentum accelerated on a two-year stack basis,” Hourican said, adding that the company expects that momentum to continue into fiscal 2027. Sysco’s U.S. Foodservice, or USFS, local case volumes increased 2.6% in the fourth quarter. The company said local case growth improved 130 basis points sequentially on a two-year stacked basis, with June representing the strongest month of the quarter on both a one- and two-year basis. → MarketBeat Week in Review – 08/03 - 08/07 Are defensive sectors ready to outshine growth in 2024? Local case growth was 0.5% in the first half of fiscal 2026 and 2.9% in the second half, according to Hourican. He attributed the improvement to better sales-colleague retention and productivity, as well as targeted growth programs including Sysco Your Way, Perks 2.0 and the company’s AI 360 sales tool. Sysco said AI 360 is intended to identify selling opportunities, including opportunities to convert customers to Sysco Brand products. The company’s independent customer business grew faster than the overall industry as it exited the fiscal year, Hourican said. → Why the Landlord of the AI Boom Could Outlast the Chipmakers Sysco Brand mix in the local business rose 30 basis points year over year to 46.4% in the fourth quarter. Sales of the company’s value-tier items grew four times faster than its overall business, which Hourican said represented new cases from customers previously purchasing comparable products from competitors. National contract case volume also rose 2.6%, supported by growth in healthcare, travel and hospitality, and foodservice management. That growth was partly offset by industrywide softness in national restaurant traffic. Sysco said it expects positive national contract volume growth in fiscal 2027, despite continued pressure on restaurant foot traffic. International local case volume grew 4.5%, while international sales increased 6.7%, gross profit rose 7.3% and adjusted operating income increased 15.7%. The quarter marked Sysco’s 11th consecutive quarter of double-digit adjusted operating-income growth in its international segment. Quarterly gross profit increased 3.7% to $4.1 billion, although gross margin declined 17 basis points to 18.7%. Interim Chief Financial Officer Brandon Sewell said gross-margin comparisons were affected by unusually large strategic-sourcing benefits in the prior-year fourth quarter and higher fuel costs during the latest period. Adjusted operating expenses grew 3.6%, slower than gross profit and revenue. Adjusted operating income increased 4.1% to $1.1 billion, and adjusted EBITDA rose 4.7% to $1.3 billion. The company said warehouse and delivery operations achieved their productivity targets for the year. On-time delivery performance improved by 10 percentage points versus customer promise windows during the fourth quarter, while routing initiatives lowered cost to serve. Sysco also reported its third consecutive year of reducing miles driven and improving pieces per mile. For fiscal 2026, free cash flow rose 16.3% to $2.1 billion. Sysco ended the quarter with a net debt leverage ratio of 2.7 times. The company paid $1 billion in dividends during the year and repurchased $200 million in shares before suspending annual repurchases in connection with its planned Restaurant Depot transaction. Sysco’s fiscal 2027 outlook is based on the standalone business and includes a 53rd week. The company expects net sales growth of approximately 6% to 7%, reaching roughly $90 billion, including about 1.5% to 2% inflation and roughly 2% growth from the additional week. USFS local case growth of approximately 2.5%. Adjusted EPS growth of 9% to 11%, or approximately $5.02 to $5.12 per share. First-quarter adjusted EPS of approximately $1.18 to $1.20. Approximately $100 million of in-year cost savings, representing about $160 million on a run-rate basis. About $1 billion in dividends and continued double-digit profit growth in the international segment. Management said the cost-savings program includes AI-enabled projects across sales, merchandising, supply chain and back-office operations. Sewell said savings will begin toward the end of the first quarter and be weighted toward the second half of the year, with a greater contribution from USFS. Hourican said the company’s work includes upgraded routing software, improved inventory forecasting, technology tools for indirect procurement and AI-assisted contract management. He said the initiatives are intended to improve customer service while reducing administrative work and structural operating costs. Sysco reiterated that it expects to close its acquisition of Restaurant Depot by the third quarter of fiscal 2027. The company received a second request from the Federal Trade Commission during the quarter, which Hourican said was expected. Management said the transaction is expected to produce $250 million of cost synergies through procurement and expand the Restaurant Depot format to more than 125 new geographies over time. Sysco also said it does not intend to raise prices at Restaurant Depot stores and believes combined purchasing and supply-chain capabilities could strengthen the retailer’s value offering. Restaurant Depot leadership told Sysco that sales grew approximately 4% in its most recently completed calendar quarter, with operating margins in line with expectations, according to Hourican. Sysco said it remains focused on preserving cash, improving working capital and reducing debt after the transaction. In June, the company added $2 billion of interest-rate hedges related to transaction financing. Management said excess cash flow generated through efficiency improvements will be directed toward faster deleveraging. Sysco Corporation (NYSE: SYY) is a global foodservice distribution company that supplies a broad range of food and related products to restaurants, healthcare and educational facilities, lodging establishments, and other foodservice customers. Its core business is the procurement, warehousing and delivery of fresh, frozen and dry food products, complemented by non-food items such as paper goods, kitchen equipment, cleaning supplies and tabletop products. Sysco serves customers through an extensive network of distribution centers and dedicated delivery fleets, positioning itself as a one-stop supplier for operators of all sizes. Founded in 1969 and headquartered in Houston, Texas, Sysco has grown through both organic expansion and acquisitions. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Sysco Q4 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

In early August 2026, Cardinal Health announced that Anita Zielinski will become Chief Accounting Officer in November, following her interim CFO and senior accounting roles at Baxter and long tenure at Sysco and Ernst & Young, while the company also faced ongoing Class II recalls of subpotent levothyroxine tablets distributed nationwide in the US. This combination of leadership change in Cardinal Health’s finance function and routine but nationwide product recalls comes as analysts are highlighting expectations for stronger upcoming quarterly earnings across key distribution and medical segments. We’ll now explore how the appointment of seasoned finance leader Anita Zielinski influences Cardinal Health’s existing investment narrative and risk profile. Outshine the giants: these 16 early-stage AI stocks could fund your retirement. To own Cardinal Health, you need to believe its scale in drug and medical supply distribution can keep generating modest growth and cash returns despite tight margins, regulation and customer concentration. The latest appointment of Anita Zielinski as Chief Accounting Officer and the Class II levothyroxine recalls do not appear to materially change the near term focus on execution in core distribution or the key risk around pricing and contract pressure. The most relevant recent announcement here is the ongoing nationwide Class II recalls of subpotent levothyroxine tablets distributed by Cardinal Health. While these recalls are voluntary and relatively routine for a large distributor, they underline operational and quality control risks that sit alongside the main earnings catalyst of steady pharmaceutical volume growth and efficiency gains in the supply chain. Yet behind the headline leadership change, investors should still be aware of how tightening government pricing scrutiny could... Read the full narrative on Cardinal Health (it's free!) Cardinal Health's narrative projects $314.3 billion revenue and $2.3 billion earnings by 2029. This requires 7.8% yearly revenue growth and about a $0.7 billion earnings increase from $1.6 billion today. Uncover how Cardinal Health's forecasts yield a $250.53 fair value, a 5% upside to its current price. Three fair value estimates from the Simply Wall St Community span roughly US$250 to almost US$495 per share, showing how far apart individual views can be. Against that backdrop, regulatory and pricing risks around Cardinal Health's low margin distribution model give you a very different angle on how its performance could evolve, so it is worth weighing several perspectives before forming your own view. Explore 3 other fair value estimates on Cardinal Health - why the stock might be worth over 2x more than the current price! Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts. A great starting point for your Cardinal Health research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision. Our free Cardinal Health research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Cardinal Health's overall financial health at a glance. Our daily scans reveal stocks with breakout potential. Don't miss this chance: AI is about to change healthcare. These 42 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10b in market cap - there's still time to get in early. We've uncovered the 8 dividend fortresses yielding 5%+ that don't just survive market storms, but thrive in them. Find 50 companies with promising cash flow potential yet trading below their fair value. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include CAH. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]