- If you are wondering whether Sysco at around US$71.16 is offering value or just treading water, this breakdown is designed to give you a clear, structured view of what you are really paying for.
- The share price has seen short term pressure, with returns of a 13.9% decline over 7 days, a 19.1% decline over 30 days, a 2.0% decline year to date and a 2.3% decline over the past year, while the 3 year and 5 year returns sit close to flat.
- Recent attention on Sysco has focused on its position as a major US foodservice distributor and how broader consumer and hospitality trends may influence demand for its services. These themes help frame why some investors are reassessing both risk and opportunity at the current price.
- Sysco currently holds a 5 out of 6 valuation score. The next sections will walk through what that means across different methods, before finishing with a way to pull those valuation signals together into a more complete view of the stock.
Find out why Sysco's -2.3% return over the last year is lagging behind its peers.
Approach 1: Sysco Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow model takes estimates of the cash a company may generate in the future and discounts those projections back to what they are worth today. It focuses on cash available to shareholders, not accounting profits.
For Sysco, the latest twelve month Free Cash Flow is about $1.76b. Analysts have provided detailed projections out to 2030, with Simply Wall St extending those estimates further using its own assumptions. By 2030, Free Cash Flow is projected at $3.51b, with intermediate annual figures between 2026 and 2035 ranging from about $2.45b to $4.16b. These figures are based on a mix of analyst inputs and extrapolated growth rates that are described as being around the mid single digit level.
Using a 2 Stage Free Cash Flow to Equity model and discounting those projected cash flows back to today, the DCF estimate indicates an intrinsic value of about $149.43 per share. Against the current share price of roughly $71.16, this model suggests Sysco trades at about a 52.4% discount to that intrinsic value. On this cash flow view, the stock screens as undervalued.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Sysco is undervalued by 52.4%. Track this in your watchlist or portfolio, or discover 62 more high quality undervalued stocks.
Approach 2: Sysco Price vs Earnings
P/E is a useful way to look at a profitable company like Sysco because it links what you pay directly to the earnings the business is already generating. Investors typically accept a higher or lower P/E depending on what they expect for future earnings growth and how much risk they see in those earnings.
Sysco currently trades on a P/E of about 18.93x. That sits close to the Consumer Retailing industry average of roughly 18.01x and well below the peer group average of 31.48x. On a simple comparison, Sysco is priced roughly in line with its wider industry and at a discount to peers.
Simply Wall St also provides a “Fair Ratio” of 26.05x, which is the P/E level it would expect based on Sysco’s earnings growth profile, industry, profit margins, market cap and risk factors. This Fair Ratio aims to be more tailored than a basic peer or industry comparison because it adjusts for the company’s own characteristics rather than assuming it should trade exactly like the average stock.
Comparing the current P/E of 18.93x with the Fair Ratio of 26.05x indicates Sysco is trading below that modelled level.
Result: UNDERVALUED
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Upgrade Your Decision Making: Choose your Sysco Narrative
Earlier it was mentioned that there is an even better way to understand valuation, so Narratives are introduced here as your own clear story about Sysco that connects what you think about its business, such as the CAGNY execution focus, foodservice positioning and risks like weather or sales consultant turnover, to a set of revenue, earnings and margin estimates. Simply Wall St then converts these into a Fair Value that you can compare against the current price to decide whether Sysco looks attractive or stretched. This is all available inside an easy tool on the Community page that updates when new news or earnings land. For example, one investor might build a higher conviction case closer to US$102, while another takes a more cautious stance around US$83, giving you a transparent range of views to benchmark your own Narrative against.
Do you think there's more to the story for Sysco? Head over to our Community to see what others are saying!
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.
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