Cantor Fitzgerald Starts United Natural Foods (UNFI) at Sell; Shares Already Discounting Significant Benefits

Cantor Fitzgerald initiates coverage on United Natural Foods (NASDAQ: UNFI) with a Sell. PT $33.00.

Analyst, Ajay Jain, said, "Although valuation by itself is traditionally not the most relevant consideration with respect to UNFI's shares, we are increasingly concerned that the rate of earnings growth has become somewhat de-coupled from UNFI’s top-line growth trends...Currently trading at an EV/EBITDA multiple of 12-13x our FY:12 estimates, the current valuation more than fully discounts what can be reasonably supported based upon UNFI’s longer-term outlook and for the industry in general. This valuation seems particularly unreasonable in the case of UNFI, which has a high fixed cost business model with continued erosion in operating margins."

For an analyst ratings summary and ratings history on United Natural Foods click here. For more ratings news on United Natural Foods click here.

Shares of United Natural Foods closed at $47.66 yesterday.

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