7 Most Profitable Food Stocks To Invest In

3. US Foods Holding Corp. (NYSE:USFD)

TTM Net Income: $575 Million

5-Year Net Income CAGR: 7.91%

Number of Hedge Fund Holders: 50

US Foods Holding Corp. (NYSE:USFD) is a leading food service distributor in the United States, serving around 250,000 restaurants and food service operators. The company offers a wide variety of food products, including frozen and dry foods, non-food products, and a comprehensive suite of e-commerce, technology, and business solutions.

In the third quarter of 2024, US Foods Holding Corp. (NYSE:USFD) reported a strong performance with net sales increasing by 6.8% to reach $9.7 billion. Total case volume also grew by 3.8%, with independent restaurant case volume rising by 4.1%. The company has successfully executed its strategy-driven operating model and leading digital solutions, resulting in continuous market share gains for 14 consecutive quarters with independent restaurants.

The company’s gross profit increased by 8.1% to $1.7 billion, reflecting effective pricing strategies and operational efficiencies. Notably, net income was $148 million, while adjusted EBITDA saw a significant increase of 13.2%, reaching $455 million. The company’s focus on digital solutions has enhanced its service offerings, including the MOXē platform that allows customers to manage orders and inventory seamlessly. Additionally, the introduction of a food cost calculator within MOXē now provides valuable insights to help customers optimize menu pricing and product selection.

The company has also been proactive in capital deployment, repurchasing $580 million worth of shares in the third quarter of 2024. Since starting its buyback program in late 2022, US Foods Holding Corp. (NYSE:USFD) has repurchased over $1.1 billion in shares, reflecting confidence in its valuation.

These initiatives and strong financial results position US Foods Holding Corp. (NYSE:USFD) as an attractive investment opportunity in the food sector, making it a compelling stock to consider for investors seeking growth potential. USFD has received a favorable outlook from analysts, who have a consensus buy rating for the stock. The 1-year median price target of $75.00 set by analysts indicates a potential upside of 12% from current levels.