There’s a lot to be optimistic about in the Services sector as 2 analysts just weighed in on Performance Food Group (NYSE: PFGC) and XPO Logistics (NYSE: XPO) with bullish sentiments.
Performance Food Group (NYSE: PFGC)
“We are looking for 1Q EPS of $0.22 and adj. EBITDA of $84.7M (+3.3% y/y) in 1Q. Note we do not add back stock comp. We estimate +2.3% total sales growth, led by +11.0% growth at Vistar, +1.0% at PFS and ~flat at Customized. Note we assume deflation of -3.0% at PFS.”
According to TipRanks.com, Short is a 4-star analyst with an average return of 2.7% and a 50.5% success rate. Short covers the Services sector, focusing on stocks such as The Chefs’ Warehouse, United Natural Foods, and Vitamin Shoppe Inc.
Performance Food Group has an analyst consensus of Moderate Buy, with a price target consensus of $25.
XPO Logistics (NYSE: XPO)
Oppenheimer analyst Scott Schneeberger reiterated a Buy rating on XPO Logistics (NYSE: XPO) yesterday and set a price target of $42. The company’s shares opened today at $35.67, close to its 52-week high of $37.94.
“Delivering a robust step-up in 2Q16, XPO followed it with formidable 3Q16 results, as adjusted EBITDA and EPS both topped consensus expectations. Furthermore, XPO increased its 2016 free cash flow guidance, partly on saved capex from divesting its Truckload business, but more so on improved cash from operations. We’re mindful of the economic environment, but note XPO’s relatively less cyclical profile vs. its peers (1/3 Contract Logistics) and company-specific synergy/efficiency story, and still view potential for upside to 2016 adjusted EBITDA and FCF guidance of $1.245B (maintained $1.265B-$20M from Truckload divestiture) and >$175M, respectively. Following a “dynamic” mid-2015, XPO has delivered everything it said it would (with relatively consistent upside) over the past 12 months.”
According to TipRanks.com, Schneeberger is a top 25 analyst with an average return of 10.8% and a 61.6% success rate. Schneeberger covers the Services sector, focusing on stocks such as New Oriental Education Tech, Capella Education Company, and Kansas City Southern.
Currently, the analyst consensus on XPO Logistics is Strong Buy and the average price target is $45.25, representing a 26.9% upside.
In a report issued on October 28, Citigroup also reiterated a Buy rating on the stock with a $38 price target.