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1. Company Snapshot

1.a. Company Description

United Natural Foods, Inc., together with its subsidiaries, distributes natural, organic, specialty, produce, and conventional grocery and non-food products in the United States and Canada.It operates in two segments, Wholesale and Retail.The company offers grocery and general merchandise, produce, perishables and frozen foods, nutritional supplements and sports nutrition, bulk and foodservice products, and personal care items.


It also provides Woodstock brand imports, roasts, packages, and distributes nuts, dried fruits, seeds, trail mixes, granola, natural and organic snack items, and confections.In addition, the company is involved in importing, roasting, packaging, and distributing nuts, dried fruits, seeds, trail mixes, granola, natural and organic snack items, and confections.Further, it offers Blue Marble Brands products through wholesale segment, third-party distributors, and directly to retailers; and Field Day brand products primarily to customers through its independent channel.


Additionally, the company provides general merchandise, home, health and beauty care, and pharmacy products, as well as private label products through a network of 74 Cub Foods and Shoppers retail grocery stores; professional services, such as retail store support, advertising, couponing, e-commerce, consumer convenience services, store design, equipment sourcing, electronic payments processing, network and data hosting solutions, and administrative back-office solutions; and marketing services comprising consumer and trade marketing programs, as well as programs to support suppliers in understanding its markets.The company serves chains, independent retailers, and supernatural chains, as well as foodservice, e-commerce, conventional military business, and other sales customers.United Natural Foods, Inc.


was founded in 1976 and is headquartered in Providence, Rhode Island.

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1.b. Last Insights on UNFI

United Natural Foods, Inc.'s recent performance is driven by improved cash flow outlook for fiscal 2026, with management targeting $300 million in free cash flow. The 2018 Supervalu acquisition is showing real synergies, contributing to strong earnings and a robust 2026 outlook. Lean management has significantly raised EBITDA, and secular growth in demand for natural foods is expected to drive sales. The company's Q4 results beat Wall Street's expectations, with a quarterly adjusted loss of 11 cents per share. Analysts have raised their forecasts following upbeat Q4 results.

1.c. Company Highlights

2. UNFI's Q1 Results Exceed Expectations, Driven by Natural Segment Growth

United Natural Foods, Inc. (UNFI) reported net sales of $7.8 billion for the first quarter of fiscal 2026, roughly flat compared to the prior year, with the natural segment growing 11% driven by strong unit growth, new business projects, and secular strength in natural, organic, and specialty products. The company's adjusted EBITDA was $107 million, up 25% year over year, and free cash flow improved by over $100 million. UNFI's earnings per share (EPS) came in at $0.56, beating estimates of $0.39. Gross margin rate was 13.4%, up 20 basis points versus the prior year quarter, and operating expense rate was 12.7% of net sales, compared to 12.9% last year.

Publication Date: Dec -04

📋 Highlights
  • Adjusted EBITDA Growth:: EBITDA surged 25% YoY to $107M, with free cash flow up over $100M vs. prior year.
  • Natural Segment Strength:: Natural sales grew 11% driven by unit volume, new projects, and secular demand, offsetting conventional segment declines.
  • Gross Margin Expansion:: Gross margin rate reached 13.4% (+20 bps YoY), while net leverage ratio dropped to 3.2x from 4.2x.
  • Annual Outlook Affirmed:: EBITDA guidance of $630M–$700M and sales of $31.6B–$32B, with debt reduction target of ≤2.5x leverage by 2026.

Segment Performance

The natural segment's strong growth was a key driver of UNFI's results, offsetting declines in the conventional segment. The company's Q1 EBITDA was $167 million, reflecting the benefit of accretive network optimization, supplier programs, and temporary procurement gains. UNFI expects the natural segment to continue growing at a mid-single digit rate in the long term.

Outlook and Guidance

UNFI affirmed its annual outlook for all key financial metrics, including sales of $31.6 billion to $32 billion, adjusted EBITDA of $630 to $700 million, and adjusted EPS range of $1.50 to $2.30 per share. The company expects to prioritize reducing net debt and improve its net leverage ratio to 2.5 times or less by year end. Analysts estimate next year's revenue growth at 0.5%.

Valuation and Capital Allocation

UNFI's current valuation metrics indicate a Price-to-Sales Ratio of 0.06 and an EV/EBITDA ratio of 22.98. The company's goal is to deleverage to 2.5 times or lower by the end of 2026 and to 2 times or less in 2027. UNFI remains focused on reducing debt, and free cash flow performance is expected to be strong, with a goal to consume the $250 million CapEx envelope.

Operational Focus

The company is focused on improving operational execution, service levels, profitability, free cash flow, and capital structure. UNFI sees opportunities to help customers win through innovation and differentiation, particularly in the natural and organic segment, and is working to increase penetration across good, better, and best tiers in its private label portfolio.

3. NewsRoom

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United Natural Foods, Inc. $UNFI Shares Sold by Edgestream Partners L.P.

Dec -04

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United Natural Q1 Earnings Beat Estimates, Sales Decline Y/Y

Dec -03

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United Natural Foods, Inc. (UNFI) Q1 2026 Earnings Call Transcript

Dec -02

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Why United Natural Foods Stock Is Popular Today

Dec -02

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Nasdaq Surges 200 Points; United Natural Foods Posts Upbeat Earnings

Dec -02

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United Natural Foods (UNFI) Surpasses Q1 Earnings Estimates

Dec -02

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Stock Market Live December 2: Crypto Traders Pounce, S&P 500 (VOO) Bounces

Dec -02

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United Natural Foods, Inc. Reports First Quarter Fiscal 2026 Results

Dec -02

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.35%)

6. Segments

Wholesale

Expected Growth: 2.5%

United Natural Foods, Inc.'s wholesale segment growth of 2.5% is driven by increasing demand for natural and organic products, expansion of existing customer relationships, and strategic acquisitions. Additionally, the company's investments in e-commerce and digital capabilities are enhancing its wholesale business, while its focus on private label products and supply chain optimization are improving operational efficiency.

Retail

Expected Growth: 1.8%

United Natural Foods, Inc.'s 1.8% retail growth is driven by increasing consumer demand for natural and organic products, expansion of e-commerce capabilities, and strategic acquisitions. Additionally, the company's focus on private label brands, efficient supply chain management, and strong relationships with independent retailers contribute to its growth momentum.

Eliminations

Expected Growth: 0.5%

United Natural Foods, Inc.'s 0.5% growth is driven by increasing demand for natural and organic products, expansion of e-commerce channels, and strategic acquisitions. Additionally, the company's focus on private label brands, cost savings initiatives, and supply chain optimization efforts contribute to its moderate growth.

Other

Expected Growth: 2.2%

United Natural Foods, Inc.'s 2.2% growth in the 'Other' segment is driven by increasing demand for specialty and gourmet products, expansion of e-commerce capabilities, and strategic acquisitions. Additionally, the company's focus on private label brands and growing sales in the supernatural channel also contribute to this growth.

7. Detailed Products

Natural Food Products

United Natural Foods, Inc. offers a wide range of natural food products, including organic and non-organic fruits, vegetables, meats, dairy products, and bakery items.

Specialty Foods

The company provides specialty foods, such as gourmet, ethnic, and artisanal products, catering to diverse consumer preferences.

Supplements and Wellness Products

United Natural Foods, Inc. offers a variety of supplements, vitamins, and wellness products, including probiotics, herbal supplements, and natural health remedies.

Meat, Seafood, and Poultry

The company provides a range of meat, seafood, and poultry products, including organic, grass-fed, and free-range options.

Bakery and Deli Products

United Natural Foods, Inc. offers a variety of bakery and deli products, including artisanal bread, pastries, and prepared foods.

Dairy and Frozen Foods

The company provides a range of dairy and frozen food products, including organic, non-dairy, and specialty items.

Beverages and Snacks

United Natural Foods, Inc. offers a variety of beverages and snacks, including organic, natural, and specialty items.

8. United Natural Foods, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

United Natural Foods, Inc. operates in a market with moderate threat of substitutes. While there are some alternatives to natural and organic products, the company's focus on quality and sustainability helps to differentiate its offerings.

Bargaining Power Of Customers

United Natural Foods, Inc. has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's strong relationships with its customers and suppliers help to mitigate the bargaining power of customers.

Bargaining Power Of Suppliers

United Natural Foods, Inc. has a moderate level of bargaining power with its suppliers. While the company has some negotiating power due to its size and scale, it also relies on a network of suppliers to provide high-quality products.

Threat Of New Entrants

The natural and organic products industry has moderate barriers to entry, including regulatory hurdles and the need for specialized knowledge and expertise. This reduces the threat of new entrants for United Natural Foods, Inc.

Intensity Of Rivalry

The natural and organic products industry is highly competitive, with many established players and new entrants vying for market share. United Natural Foods, Inc. must continually innovate and differentiate its offerings to maintain its market position.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 65.20%
Debt Cost 3.95%
Equity Weight 34.80%
Equity Cost 7.05%
WACC 5.03%
Leverage 187.32%

11. Quality Control: United Natural Foods, Inc. passed 4 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

Stock-Card
SpartanNash

A-Score: 5.3/10

Value: 7.3

Growth: 3.3

Quality: 2.1

Yield: 7.0

Momentum: 8.5

Volatility: 3.3

1-Year Total Return ->

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Chefs Warehouse

A-Score: 5.2/10

Value: 3.9

Growth: 8.7

Quality: 5.2

Yield: 0.0

Momentum: 8.0

Volatility: 5.7

1-Year Total Return ->

Stock-Card
AMCON

A-Score: 4.6/10

Value: 7.5

Growth: 6.7

Quality: 3.6

Yield: 4.0

Momentum: 2.0

Volatility: 4.0

1-Year Total Return ->

Stock-Card
UNFI

A-Score: 4.4/10

Value: 7.0

Growth: 4.6

Quality: 1.9

Yield: 0.0

Momentum: 10.0

Volatility: 3.0

1-Year Total Return ->

Stock-Card
Mission Produce

A-Score: 4.2/10

Value: 5.1

Growth: 4.7

Quality: 4.3

Yield: 0.0

Momentum: 5.0

Volatility: 6.3

1-Year Total Return ->

Stock-Card
HF Foods Group

A-Score: 3.3/10

Value: 9.5

Growth: 3.2

Quality: 3.1

Yield: 0.0

Momentum: 1.5

Volatility: 2.3

1-Year Total Return ->

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

34.11$

Current Price

34.11$

Potential

-0.00%

Expected Cash-Flows