Strong Q2 Results and Upgraded Outlook Could Be a Game Changer for Chefs' Warehouse (CHEF)

• Chefs' Warehouse recently reported second quarter 2025 results, showing sales of US$1.03 billion and net income of US$21.24 million, both higher than the previous year, along with raised full-year guidance for net sales and gross profit.
• A two-stage discounted cash flow analysis estimates the company’s shares may be substantially undervalued, highlighting the importance of assessing future cash flows and underlying business fundamentals.
• With new guidance projecting higher sales and profit, we'll examine how this improved full-year outlook could influence Chefs' Warehouse's investment narrative.

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Chefs' Warehouse Investment Narrative Recap

To be a shareholder in Chefs' Warehouse, you need to believe in the ongoing premiumization of the foodservice sector and the company's ability to grow profitably through expansion and operational efficiency. The latest Q2 results, with record sales and raised full-year guidance, meaningfully strengthen management’s case for continued earnings momentum, though rising operating costs remain the most immediate risk for compressing margins in the near term.

The announcement of increased full-year 2025 sales and gross profit guidance stands out as the most relevant recent development. This upward revision could serve as a strong near-term catalyst, reinforcing confidence in both execution and demand resilience, but it does not remove ongoing exposure to structural cost inflation or integration challenges.

However, while bullish top-line trends grab headlines, investors should be aware of the persistent risk of labor cost escalation and the question of how much...

Read the full narrative on Chefs' Warehouse (it's free!)

Chefs' Warehouse's narrative projects $4.7 billion in revenue and $115.6 million in earnings by 2028. This requires 6.8% yearly revenue growth and a $51.8 million earnings increase from current earnings of $63.8 million.

Uncover how Chefs' Warehouse's forecasts yield a $73.71 fair value, a 10% upside to its current price.

Exploring Other Perspectives

Three fair value estimates from the Simply Wall St Community range from US$69.25 to US$119.14 per share. Even with consensus pointing to strong earnings growth, you can see how widely opinions differ on what happens next.

Explore 3 other fair value estimates on Chefs' Warehouse - why the stock might be worth as much as 78% more than the current price!

Build Your Own Chefs' Warehouse Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Chefs' Warehouse research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Chefs' Warehouse research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Chefs' Warehouse's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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