US Foods Holding Corp. (USFD) | Investment Case

1. Company Snapshot

1.a. Company Description

US Foods Holding Corp., through its subsidiary, US Foods, Inc., markets and distributes fresh, frozen, and dry food and non-food products to foodservice customers in the United States.The company's customers include independently owned single and multi-unit restaurants, regional concepts, national restaurant chains, hospitals, nursing homes, hotels and motels, country clubs, government and military organizations, colleges and universities, and retail locations.As of July 06, 2022, it operated 70 broadline facilities; and 80 cash and carry locations.

The company was formerly known as USF Holding Corp.and changed its name to US Foods Holding Corp.in February 2016.

US Foods Holding Corp.was incorporated in 2007 and is headquartered in Rosemont, Illinois.

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1.b. Last Insights on USFD

US Foods Holding Corp.'s recent performance has been positively driven by increased institutional investor confidence. CENTRAL TRUST Co boosted its stock position by 30,283.3% and Creative Planning grew its holdings by 9.5%. Additionally, the company reported Q4 2025 earnings of $1.04 per share, beating estimates. Analysts expect continued growth, with a consensus recommendation of "Moderate Buy" from 11 brokerages. The company's strong earnings surprise history also positions it for potential future beats.

1.c. Company Highlights

Last Price	96.71
Change Percentage	0.34%
Open	96.78
Previous Close	96.38
Market Cap ( Millions)	21561
Volume	2864667
Year High	102.13
Year Low	57.36
M A 50	82.6
M A 200	78.44

FCF Yield	4.45%
Dividend Yield	0.00%
ROE	15.01%
Debt / Equity	140.00%
Net Debt / EBIDTA	342.62%
Price To Book	4.99
Price Earnings Ratio	31.79
Price To FCF	22.48
Price To sales	0.55
EV / EBITDA	15.76

2. US Foods Holding Corp. Delivers Strong Q4 '25 Earnings

US Foods Holding Corp. reported a robust Q4 '25, with net sales increasing 3.3% to $9.8 billion and adjusted EBITDA growing 11% to $490 million. The company's adjusted diluted EPS increased 24% to $1.04, beating analyst estimates of $1. The strong EPS growth was driven by the company's ability to grow adjusted EPS significantly faster than adjusted EBITDA. The profit pillar was driven by strong execution and margin initiatives, resulting in adjusted EBITDA margin expansion. US Foods continues to drive gross profit gains and offset operating expense inflation with supply chain and productivity improvements.

Publication Date: Feb -16

                                    📋 Highlights
                                    Adjusted EBITDA Record:
                                                Surpassed long-range plan with $1.9B growth (11%) and 30 bps margin expansion to 4.9%.
Shareholder Returns:
                                                Repurchased $930M in shares (11.9M shares) and $131M spent on tuck-in acquisitions in 2025.
Independent Restaurant Growth:
                                                4.1% case volume increase, 4.7% net new account growth, despite 2.8% chain foot traffic decline.
2026 Guidance:
                                                4-6% net sales growth and 9-13% adjusted EBITDA growth, with 53rd week adding 1% to case and EBITDA growth.
Private Label Momentum:
                                                25% of independent customers have >70% private label penetration, with 190 bps gross profit outperformance over expenses.

                                

Key Drivers of Margin Expansion

The company highlighted four key drivers of its industry-leading margin expansion, including cost of goods savings, private label growth, inventory management, and indirect cost savings. These initiatives have enabled the company to expand its EBITDA margin by 30 basis points to 4.9% in 2025. According to Dirk Locascio, "We invested $410 million in cash CapEx to support our business and enable organic growth." The company's focus on execution and margin initiatives has driven significant gains in operating leverage.

2026 Guidance and Outlook

US Foods' 2026 guidance includes a 53rd week, expected to add 1% to total case growth and adjusted EBITDA growth. The company expects to grow total company net sales by 4% to 6% and adjusted EBITDA by 9% to 13%. The guidance assumes a similar macro environment to 2025, with potential upside from tax refunds and other tailwinds. Analysts estimate next year's revenue growth at 4.2%, which is within the company's guidance range.

Valuation Metrics

US Foods' current valuation metrics indicate a P/E Ratio of 32.85, EV/EBITDA of 17.74, and ROE of 15.01%. These metrics suggest that the market is pricing in a certain level of growth and profitability. With the company's strong track record of delivering profitable growth, it remains to be seen whether the current valuation is justified.

Sales Force Compensation and Growth

The company is transitioning to a 100% variable compensation structure for its local sales force, which is expected to drive stronger alignment to business objectives and unleash its sales force to help accelerate long-term growth. According to Dirk Locascio, the changes would "unlock the sales force's full potential, driving further growth." The sales force expansion, including a 7% increase in sales force headcount, is expected to drive growth, particularly in the back half of 2026.

3. NewsRoom

US Foods Holding Corp. (USFD) Presents at Consumer Analyst Group of New York Conference 2026 Transcript

Feb -20

Source: seekingalpha.com

US Foods Holding Corp. $USFD Shares Acquired by State of New Jersey Common Pension Fund D

Feb -19

Source: defenseworld.net

First Look: WBD waiver; Ackman's Meta bet; Ford-China JV

Feb -17

Source: gurufocus.com

CENTRAL TRUST Co Boosts Stock Position in US Foods Holding Corp. $USFD

Feb -16

Source: defenseworld.net

Envestnet Asset Management Inc. Reduces Stock Position in US Foods Holding Corp. $USFD

Feb -16

Source: defenseworld.net

US Foods Holding Corp. (USFD) Q4 2025 Earnings Call Transcript

Feb -12

Source: seekingalpha.com

US Foods (USFD) Tops Q4 Earnings Estimates

Feb -12

Source: zacks.com

Keybank National Association OH Cuts Stock Holdings in US Foods Holding Corp. $USFD

Feb -08

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.37%)

6. Segments

Meats and Seafood

Expected Growth: 4.5%

The 4.5% growth in Meats and Seafood from US Foods Holding Corp. is driven by increasing demand for premium and organic products, rising popularity of online food delivery, and strategic acquisitions expanding the company's customer base and product offerings.

Dry Grocery

Expected Growth: 4.2%

The 4.2% growth in Dry Grocery from US Foods Holding Corp. is driven by increasing demand for convenient and healthy food options, rising e-commerce adoption, and strategic partnerships with foodservice providers. Additionally, the company's focus on private label products and efficient supply chain management has contributed to the growth.

Refrigerated and Frozen Grocery

Expected Growth: 4.8%

The 4.8% growth in Refrigerated and Frozen Grocery from US Foods Holding Corp. is driven by increasing demand for convenient and healthy meal options, rising popularity of online grocery shopping, and strategic acquisitions expanding product offerings and distribution channels.

Dairy

Expected Growth: 4.0%

Strong demand for dairy products, driven by increasing consumer preference for healthy and organic food options, contributes to 4.0% growth. Additionally, US Foods Holding Corp.'s strategic acquisitions and investments in digital platforms enhance operational efficiency, leading to increased sales and market share gains.

Equipment, Disposables and Supplies

Expected Growth: 3.8%

US Foods Holding Corp's Equipment, Disposables and Supplies segment growth of 3.8% is driven by increasing demand for food-away-from-home, rising need for convenient and portable food solutions, and growing adoption of digital technologies in the foodservice industry. Additionally, the company's strategic initiatives, such as its 'Great Food. Made Easy.' platform, are also contributing to the segment's growth.

Beverage

Expected Growth: 4.6%

The 4.6% growth in Beverage segment of US Foods Holding Corp. is driven by increasing demand for premium and specialty beverages, expansion of online food delivery platforms, and rising consumer preference for convenient and healthy beverages. Additionally, the company's strategic acquisitions and investments in digital capabilities have enhanced its market presence and operational efficiency.

Produce

Expected Growth: 4.4%

US Foods Holding Corp's 4.4% growth is driven by increasing demand for convenient and online food ordering, expansion of its e-commerce platform, and strategic acquisitions. Additionally, the company's focus on providing unique and innovative products, as well as its efforts to improve operational efficiency, have contributed to its growth.

7. Detailed Products

Meat, Poultry and Seafood

US Foods offers a wide range of high-quality meat, poultry, and seafood products, including beef, pork, chicken, turkey, fish, and shellfish.

Produce

US Foods provides a diverse selection of fresh fruits and vegetables, including organic and locally sourced options.

Dairy and Eggs

US Foods offers a range of dairy products, including milk, cheese, and eggs, as well as dairy alternatives.

Bakery and Pastry

US Foods provides a variety of baked goods, including bread, pastries, and desserts.

Pantry and Dry Goods

US Foods offers a range of pantry staples, including canned goods, pasta, rice, and snacks.

Beverages

US Foods provides a range of beverages, including juices, sodas, and coffee.

Non-Food Products

US Foods offers a range of non-food products, including paper products, cleaning supplies, and equipment.

Private Label Products

US Foods offers a range of private label products, including Chef's Line, Rykoff Sexton, and Stock Yards.

Sustainability and Eco-Friendly Products

US Foods offers a range of sustainable and eco-friendly products, including compostable and biodegradable options.

8. US Foods Holding Corp.'s Porter Forces

Forces Ranking

Threat Of Substitutes

US Foods Holding Corp. faces moderate threat from substitutes, as customers have limited alternatives for food distribution services. However, the company's focus on providing high-quality products and services helps to mitigate this threat.

Bargaining Power Of Customers

US Foods Holding Corp. has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's strong relationships with customers and its ability to provide customized solutions help to minimize customer bargaining power.

Bargaining Power Of Suppliers

US Foods Holding Corp. faces moderate bargaining power from suppliers, as it relies on a network of suppliers for its products. However, the company's scale and purchasing power help to mitigate this threat.

Threat Of New Entrants

The threat of new entrants is low for US Foods Holding Corp., as the food distribution industry has high barriers to entry, including significant capital requirements and complex logistics.

Intensity Of Rivalry

The food distribution industry is highly competitive, with several large players competing for market share. US Foods Holding Corp. faces intense rivalry from competitors such as Sysco and Gordon Food Service.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	52.28%
Debt Cost	8.35%
Equity Weight	47.72%
Equity Cost	11.81%
WACC	10.00%
Leverage	109.54%

11. Quality Control: US Foods Holding Corp. passed 5 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Cal-Maine Foods

A-Score: 7.5/10

Value: 8.5

Growth: 9.4

Quality: 7.8

Yield: 10.0

Momentum: 3.0

Volatility: 6.0

1-Year Total Return ->

Bunge

A-Score: 6.3/10

Value: 8.6

Growth: 5.6

Quality: 3.9

Yield: 6.0

Momentum: 7.0

Volatility: 7.0

1-Year Total Return ->

Ingredion

A-Score: 6.2/10

Value: 7.2

Growth: 6.6

Quality: 6.1

Yield: 6.0

Momentum: 1.5

Volatility: 10.0

1-Year Total Return ->

Laureate Education

A-Score: 6.2/10

Value: 2.9

Growth: 5.6

Quality: 6.0

Yield: 5.0

Momentum: 10.0

Volatility: 7.7

1-Year Total Return ->

Andersons

A-Score: 5.5/10

Value: 6.9

Growth: 5.9

Quality: 3.6

Yield: 4.0

Momentum: 7.0

Volatility: 5.7

1-Year Total Return ->

US Foods

A-Score: 5.2/10

Value: 4.4

Growth: 6.2

Quality: 4.3

Yield: 0.0

Momentum: 7.0

Volatility: 9.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

11.23%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

10.00%

US Foods Holding Corp. - US9120081099

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on USFD

1.c. Company Highlights

Higher Growth

Average Yield

Medium Volatility

Earnings Beats

Stable Momentum

Strong Momentum

Revenues Beats

Less Volatile

Earnings Miss

Revenues Miss

Lower Yield

2. US Foods Holding Corp. Delivers Strong Q4 '25 Earnings

Key Drivers of Margin Expansion

2026 Guidance and Outlook

Valuation Metrics

Sales Force Compensation and Growth

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.37%)

6. Segments

Meats and Seafood

Expected Growth: 4.5%

Dry Grocery

Expected Growth: 4.2%

Refrigerated and Frozen Grocery

Expected Growth: 4.8%

Dairy

Expected Growth: 4.0%

Equipment, Disposables and Supplies

Expected Growth: 3.8%

Beverage

Expected Growth: 4.6%

Produce

Expected Growth: 4.4%

7. Detailed Products

Meat, Poultry and Seafood

Produce

Dairy and Eggs

Bakery and Pastry

Pantry and Dry Goods

Beverages

Non-Food Products

Private Label Products

Sustainability and Eco-Friendly Products

8. US Foods Holding Corp.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: US Foods Holding Corp. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

12.e Scoring ^Insights

12.f DCF ^BETA