USFD Stock Forecast & Price Target

US Foods Holding Corp has demonstrated a positive financial trajectory, with a 4Q24 EBITDA margin expansion of 30 basis points year-over-year and sustained growth in gross profit per case, reflecting effective operational improvements and cost management. The company has successfully increased its digital sales mix to 77% among independent customers, highlighting strong engagement in its digital initiatives and a robust sales force that is contributing to new account generation across its targeted customer segments. Additionally, US Foods is expected to benefit from permanent cost savings and enhanced profitability across its healthcare, hospitality, and independent sales sectors, positioning it favorably for continued growth in 2025.

The negative outlook on US Foods Holding Corp is influenced by weaker-than-expected case growth, with total organic case growth reported at only +1.4% in the latest quarter, contrasting with a decline in overall restaurant industry foot traffic by approximately 2.0%. Guidance for 2025 reflects a muted case growth expectation of +2-4%, which falls short of the company's long-term growth algorithm of +3-5%, indicating potential challenges amidst a turbulent macroeconomic environment. Additional risks include intensified competition from Sysco Corporation, potential market share losses for independent restaurants, and uncertain recovery trajectories in their primary markets, which may further hinder growth and profitability.