5 Best Defensive Stocks to Buy Amid Geopolitical Tensions

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

Stock Upside Potential: 26.30%

Short Float: 3.64%

Number of Hedge Fund Holders: 52

US Foods Holding Corp. (NYSE:USFD) is one of the best defensive stocks to buy amid geopolitical tensions. On June 1, Piper Sandler reiterated a Neutral rating on US Foods Holding Corp. (NYSE:USFD) and lowered the price target to $88 from $103.

The price target cut comes amid concerns that the retailer will feel the brunt of weak traffic in the chain-restaurant industry. Consequently, the research firm has reduced its organic case growth estimate while also increasing its discount rate assumption to 8.75% from 8.25% to align with distribution peers.

Amid the concerns, US Foods accelerated its year-over-year independent restaurant case growth in the first quarter as it also gained share with its target customer types. The company also posted a 15% adjusted diluted earnings per share growth of $0.78 amid a deteriorating macro environment. Net sales in the quarter were also up by 2.8% to $9.6 billion.

For the full year, US Foods is projecting net sales growth of 4% to 6%, with adjusted EBITDA growth of 9% to 13%. Earnings per share are also expected to grow by between 18% and 24%.

US Foods Holding Corp. (NYSE:USFD) is a massive food service distributor that supplies food and kitchen essentials to approximately 250,000 locations, including independent restaurants, healthcare facilities, hotels, and educational institutions.