Earnings Update: Here's Why Analysts Just Lifted Their United Natural Foods, Inc. (NYSE:UNFI) Price Target To US$20.86

Shareholders of United Natural Foods, Inc. (NYSE:UNFI) will be pleased this week, given that the stock price is up 18% to US$19.76 following its latest full-year results. It was a pretty bad result overall; while revenues were in line with expectations at US$31b, statutory losses exploded to US$1.89 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for United Natural Foods

Taking into account the latest results, United Natural Foods' ten analysts currently expect revenues in 2025 to be US$30.7b, approximately in line with the last 12 months. United Natural Foods is also expected to turn profitable, with statutory earnings of US$0.38 per share. In the lead-up to this report, the analysts had been modelling revenues of US$30.8b and earnings per share (EPS) of US$0.18 in 2025. Although the revenue estimates have not really changed, we can see there's been a very substantial lift in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.

The consensus price target rose 51% to US$20.86, suggesting that higher earnings estimates flow through to the stock's valuation as well. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values United Natural Foods at US$23.00 per share, while the most bearish prices it at US$12.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that revenue is expected to reverse, with a forecast 1.1% annualised decline to the end of 2025. That is a notable change from historical growth of 4.5% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 4.6% annually for the foreseeable future. It's pretty clear that United Natural Foods' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around United Natural Foods' earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that United Natural Foods' revenue is expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for United Natural Foods going out to 2027, and you can see them free on our platform here..

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with United Natural Foods (at least 1 which shouldn't be ignored) , and understanding these should be part of your investment process.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.