Despite Recent Case Volume Gains, Cost Pressures Stand to Weigh on Performance Foods' Profitability
The market looked favorably on no-moat Performance Food Group's first-quarter results, which included a 4% bump in sales, a 40-basis-point uptick in gross margins to 13.1%, and flat operating margins at 1.1%. However, we don't think the resulting mid-single-digit share price rise reflects the persistent and sizable industry headwinds of intense competitive pressure and cost inflation, particularly as it relates to transportation and labor. As such, we’d suggest investors remain on the sidelines ...Performance Food Group is a holding company. Through its subsidiaries, the company markets and distributes food and food-related products. The company's products include frozen foods, such as meats, appetizers and entrees, fruits, vegetables, and desserts; canned and dry foods; fresh meats; dairy products; beverage products; imported specialties; fresh produce; and candy, snack, and other products. The company also supplies non-food items including paper products such as pizza boxes, disposable napkins, plates and cups; tableware such as china and silverware; cookware such as pots, pans, and utensils; restaurant and kitchen equipment and supplies; cigarettes and other tobacco products; and cleaning supplies.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
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