The rally helped shareholders recover some lost ground, but the organic food distributor is still trailing the market by a wide margin in 2017.
September's surge followed a surprisingly strong quarterly earnings announcement. Highlights from the fiscal fourth quarter included rising sales and earnings, with United Natural Foods' revenue improving by 6%, and higher profitability as grocery price deflation became less of a drag on the business. Recent acquisitions, including Haddon House Food Products and Gourmet Guru, helped the company end its fiscal year on a positive note.
CEO Steven Spinner and his executive team are optimistic that they can extend the business rebound despite the highly competitive industry conditions. Their fiscal 2018 forecast calls for continued modest growth, with sales rising by between 3.8% and 5.8%, and earnings ranging from $2.67 per share to $2.77 per share, which translates into gains of between 4.3% and 8.2%.
That prediction implies no major disruption with its relationship with Whole Foods -- its single biggest customer -- despite that chain's acquisition by Amazon. That hint of optimism was enough to help shares recover a small fraction of the ground they've lost since early 2015.