Online Journal for the Moose Pond Investors Club

Sysco Corporation

Sysco Corporation, the food wholesaler–not the manufacturer of computer routers, is another solid buy candidate. SYY is a high quality growth company.

SYY made the Forbes’ 2004 list of the 26 best managed companies in America. Value Line gives SYY its highest ratings for both financial Strength (A++) and earnings persistence (100). SYY is a large company with annual sales of more then $8 billion.

The first call consensus EPS five-year growth rate is 15%. The SSG above uses a more conservative EPS growth rate of 11.9%. Using this lower rate, projected average return over five years is 11.3% and the total return (assuming sale at a high PE) is 14.5%. The upside downside ratio is 3.7.

This would be a particularly good stock for our portfolio since it is in an industry that we don’t hold.
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