United Natural Foods (UNFI +8.96%) delighted investors with a powerful earnings report last night, sending shares of the natural foods distributor and supermarket and liquor store operator up a lucky 7.7% through 9:45 a.m. ET this morning.
Heading into the fiscal Q1 2026 report, analysts forecast adjusted earnings of $0.40 per share on $7.9 billion in sales -- but United Natural earned more while selling less. Profits came in at $0.56 per share, while sales were just $7.8 billion.
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United Natural Q1 earnings
Not all the news was good. United Natural Foods beat on "adjusted" earnings, but its actual earnings as calculated according to generally accepted accounting principles (GAAP) were dismal. Sales for the first quarter of the fiscal year declined 0.4%, and the GAAP result was a loss of $0.06 per share.
Free cash flow also ran negative by $54 million.
Regardless, CEO Sandy Douglas insisted that United delivered "solid execution and continued progress," noting that the free cash flow number was at least better than last year's, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) grew "nearly 25%."
NYSE: UNFI
Key Data Points
Is United Natural Foods stock a buy?
Investors seem to be buying that story.
United Natural Foods said full-year sales will range from $31.6 billion to $32 billion, with adjusted earnings per share from $1.50 to $2.30. Both those numbers fall below analyst estimates. On the plus side, United Natural promised at least break-even GAAP earnings by year-end, with a profit between $0 and $0.80 per share.
Will it hit those numbers? Perhaps. But even if United maxes out its earnings guidance, the stock would have a P/E ratio of more than 47. Seems a little pricey for a grocery store, if you ask me.
