Guggenheim has raised its price target on Sysco (NYSE: SYY) to $91.00 from $89.00 while maintaining a Buy rating, reflecting what the firm described as growing confidence in the company’s ability to execute near-term improvement initiatives. The new target implies additional upside from recent trading levels - Sysco shares were at $84.14 at the time of the update and have produced a 19.36% return over the past 12 months.
The upgrade from Guggenheim followed an 11% jump in Sysco’s stock on Tuesday, a single-day gain the firm said was the company’s largest since 2020. That move materially outpaced the S&P 500’s 0.4% advance on the same day.
Guggenheim attributed the rapid share-price appreciation to management’s upbeat comments about progress on self-help measures and a clear commitment to specified top- and bottom-line improvements over the coming six months. The shop noted that while the targets management set do not appear overly aggressive, meeting them is critical to sustain the current valuation.
The new $91 target is based on an assumed 11.0x EBITDA multiple applied to Sysco’s 2027 results. Guggenheim observed that this multiple sits at the upper end of the 9-12x range it cites for foodservice distributors, and the target equates to an estimated 11% total shareholder return when dividends are included.
Sysco’s recently reported second-quarter results for fiscal 2026 provided the backdrop for the analyst interest. The company posted EPS of $0.99, narrowly above the $0.98 consensus, and reported total revenue of $21.0 billion versus forecasts of $20.78 billion.
Following the quarterly report, other brokerages also revised their valuations. UBS lifted its Sysco price target to $95 and kept a Buy rating, pointing to stronger U.S. local case volumes that improved by 140 basis points sequentially to 1.2%. Bernstein raised its target to $90, highlighting robust top-line performance and noting that local case volume growth in U.S. Foodservice exceeded its own expectations. Piper Sandler moved its target to $83, similarly citing positive case growth with local U.S. Foodservice case growth of 1.2%.
Together, the analyst moves reflect a broadly favorable response to Sysco’s recent operating results and management commentary. However, the various price-target changes are predicated on continued performance consistent with management’s stated objectives and the volume improvements reported in U.S. Foodservice.
Summary
- Guggenheim raised its price target on Sysco to $91 from $89 and retained a Buy rating.
- The stock rallied 11% in one day - its strongest single-day gain since 2020 - and traded at $84.14 while up 19.36% over the past year.
- Analyst targets from UBS, Bernstein, and Piper Sandler were also increased after Sysco slightly beat EPS and revenue expectations for fiscal Q2 2026 and reported improved U.S. local case volumes.
Key points
- Valuation assumption - Guggenheim’s $91 target uses an 11.0x EBITDA multiple on 2027 results, near the top of the 9-12x range typical for foodservice distributors.
- Near-term execution - Management’s commitment to deliver measurable top- and bottom-line improvements over the next six months is central to justifying current valuations.
- Sectors impacted - Moves affect foodservice distribution and related U.S. Foodservice segments, as well as investor sentiment in equities for distributors and broader market participation.
Risks and uncertainties
- Execution risk - Guggenheim stressed that management targets are not aggressive but must be achieved to support the valuation; failure to deliver would challenge the current price assumptions. This risk primarily affects the foodservice distribution sector.
- Volume dependency - Analyst optimism is tied to improvements in U.S. local case volumes; if those trends reverse or disappoint, outlooks and price targets could be undermined. This uncertainty impacts U.S. Foodservice operators and distributors.
- Valuation sensitivity - The new target assumes an 11.0x EBITDA multiple on 2027 results; reliance on a higher-end multiple means valuation is sensitive to both operating results and multiple compression in the market.