Investment Thesis
Sysco demonstrates stable cash generation (1.0B FCF) and exceptional debt servicing capacity (69.2x interest coverage), supporting its leverage position. However, the revenue growth data (13505% YoY) is highly suspicious and indicates data quality concerns that undermine analytical confidence. High leverage (5.58x D/E) combined with thin profitability margins (1.9% net, 3.4% operating) limits financial flexibility despite solid operational fundamentals.
Strengths
- Exceptional interest coverage (69.2x) indicating strong debt servicing capacity
- Positive and consistent free cash flow generation (1.0B annually)
- Adequate liquidity position with 1.9B cash and 1.33x current ratio
- Strong ROE (52.5%) demonstrating efficient capital utilization
Risks
- Highly suspect revenue growth data (13505% YoY) suggests major data quality or accounting anomaly requiring clarification
- Excessive leverage at 5.58x debt-to-equity ratio constrains financial flexibility
- Thin profit margins (1.9% net, 3.4% operating) limit downside protection in economic slowdowns
- Low insider form 4 activity (6 in 90 days) provides minimal confidence signal
- Minimal quick ratio (1.12x) and moderate current ratio (1.33x) suggest potential liquidity constraints
Key Metrics to Watch
- Revenue trend normalized and validated for M&A activity
- Debt-to-equity progression and deleveraging pace
- Free cash flow sustainability and capital allocation
- Operating margin expansion or contraction relative to sector
Financial Metrics
Revenue
62.4B
Net Income
1.2B
EPS (Diluted)
$2.51
Free Cash Flow
1.0B
Total Assets
28.0B
Cash
1.9B
Profitability Ratios
Gross Margin
18.4%
Operating Margin
3.4%
Net Margin
1.9%
ROE
52.5%
ROA
4.3%
FCF Margin
1.6%
Balance Sheet & Liquidity
Current Ratio
1.33x
Quick Ratio
1.12x
Debt/Equity
5.58x
Debt/Assets
0.0%
Interest Coverage
69.18x
Long-term Debt
12.8B
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-05-06T13:57:39.723255 |
Data as of: 2026-03-28 |
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