Top 10 Consumer Defensive Stocks to Buy Now

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6. Sysco Corporation (NYSE:SYY)

Stock Upside Potential: 16.90%

Number of Hedge Fund Holders: 65

Sysco Corporation (NYSE:SYY) is one of the top consumer defensive stocks to buy now. On April 7, Piper Sandler reiterated a Neutral rating on Sysco Corporation (NYSE:SYY) but cut the price target to $77 from $83. The price target cut comes on the heels of the company announcing a $29.1 billion deal to acquire Restaurant Depot in a transaction the research firm is not a fan of.

Under the terms of the agreement, Restaurant Depot shareholders are to receive $21.6 billion in cash proceeds and $91.5 million in Sysco shares. Sysco plans to finance the transaction with $21 billion in new and hybrid debt and $1 billion in cash and equity.

The acquisition is poised to expand Sysco’s footprint into the $60- $70 billion Cash and Carry Channel segment of the $380 billion US foodservice market. Sysco expects the transaction to be mid- to high-single-digit EPS accretive in year one and low to mid-teens accretive in year two. In addition, Restaurant Depot is to operate as a separate business segment within Sysco once the acquisition closes.

Sysco Corporation (NYSE:SYY) is the global leader in the sale, marketing, and distribution of food products and non-food supplies to restaurants, healthcare/educational facilities, and hospitality businesses. It operates over 300 distribution facilities worldwide, providing comprehensive supply chain solutions.

While we acknowledge the potential of SYY to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than SYY and that has 100x upside potential, check out our report about the cheapest AI stock.

Click to continue reading and see the Top 5 Consumer Defensive Stocks to Buy Now.

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