jepittman

Sysco: Where to Find Value and Growth Potential

You just don't go back far enough. 'Never' is a long time. From 1995 until early 2004 the stock was a five bagger. In 2000 the share price was comparable to what it is today. Then the company earned $.68 per share and paid a dividend of $.23 per share. Today the comapny is expected to earn $1.77 per share (in a VERY depressed year) and will pay at least $.96 a share in dividends. I expect this year (ends June 30) will be the trough year. Next year could see EPS at $1.85 or higher and the dividend near $1.00 per share. For me it is a bit hard to swallow a bearish view at these prices unless there is a continued economic contraction.

Part of the reason for the recent poor price behavior is that the entire investment world believes the consumer is dead and isn't coming back. Its soup and beans at home from now on. If this is in fact how it plays out then perhaps SYY stays flat. I think human nature and old habits are hard to break. Dining out is a small ticket luxury and when the consumer starts feeling better he will return to his favorite restaurants and enjoy an evening with friends and/or family. When he does SYY will see their volumes soar and their EPS right along with it. When SYY decisivly breaks through $24 (it may be several more weeks) it should run quickly to $30. Like the author, I am an amatuer so talk with your financial advisor. IMO, SYY will be a five bagger again.


On Jun 17 09:47 AM mdpath wrote:

> Good company but its never been a good stock.