5-Star Stocks Poised to Pop: SYSCO

Based on the aggregated intelligence of 145,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, food distributor SYSCO (NYSE: SYY  ) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at SYSCO's business and see what CAPS investors are saying about the stock right now.

SYSCO facts

Headquarters (Founded)

Houston (1969)

Market Cap

$16.62 billion

Industry

Food distribution

Trailing-12-Month Revenue

$36.06 billion

Management

CEO William DeLaney III (since 2009)
COO Kenneth Spitler (since 2007)

Return on Equity (Average, Past 3 Years)

31.8%

Cash/Debt

$878.47 million / $2.92 billion

Dividend Yield

3.4%

Competitors

CVS Caremark (NYSE: CVS  )
Walgreen (NYSE: WAG  )
Whole Foods Market (Nasdaq: WFMI  )

CAPS Members Bullish on SYY Also Bullish on

Procter & Gamble (NYSE: PG  )

CAPS Members Bearish on SYY Also Bearish on

Microsoft (Nasdaq: MSFT  )
Verizon Communications (NYSE: VZ  )

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 97% of the 1,062 members who have rated SYSCO believe the stock will outperform the S&P 500 going forward. These bulls include go4buffs and tekennedy.

Late last year, go4buffs reminded Fools that SYSCO "is the outright leader in its industry as a food supplier to everything from small to large kitchens." Our CAPS member concludes: "As the economy tries to pinch pennies out of restaurants, cafeterias, and delis, SYSCO's portfolio of low to high end food brands will help meet the need."

In an earlier pitch, tekennedy expands on the appetizing opportunity. Here's an excerpt:

SYSCO is an amazingly run company which is by far the market (there is no company close to it and they only have roughly 17% market share) leader in a highly fragmented market with strong competitive advantages. The company earns spectacular returns on capital with a highly scalable operating structure, leading to the ability to profitably grow for some time. …

The company has taken steps to help improve performance (by reducing invested capital and slightly reducing cap.ex.) and reduce risk which should help through the lean times. Even though this company won't trounce the market (don't expect more than a double unless you plan on holding for a considerable time) it should outperform the market over time.

What do you think about SYSCO, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!  

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. SYSCO and Microsoft are Motley Fool Inside Value picks. SYSCO is also a choice of Income Investor, as is Procter & Gamble. Microsoft has been singled out by Motley Fool Options as well. Whole Foods Market is a Stock Advisor pick. The Fool owns shares of SYSCO and Procter & Gamble. The Fool's disclosure policy always gets a perfect score.


Read/Post Comments (2) | Recommend This Article (21)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 09, 2010, at 10:29 AM, johnnnskdfj1234 wrote:

    I can not believe you do not have the correct competitors, none of the above compete with Sysco, USFS, PFG, GFS, Cheney Bros, etc compete with Sysco....

  • Report this Comment On January 09, 2010, at 11:43 PM, TheAbidingDude wrote:

    Walgreen is a competitor to Sysco???

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