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Is Sysco's International Business Becoming a Key Growth Driver?
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Key Takeaways
SYY's international business is becoming a solid growth driver with steady sales momentum across regions.
International local case volume rose about 5% in Q1 as Sysco deepened ties with local customers.
International gross margin rose 43 bps to 20.8%, while adjusted operating income climbed 13.1%.
Sysco Corporation’s (SYY - Free Report) international business is emerging as a more meaningful contributor to the company’s overall performance, supported by steady execution and improving fundamentals. The segment is gaining traction as a structurally stronger growth engine, offering both sales momentum and improving profitability across regions.
A notable strength within the international business has been the continued shift toward local customers. In the first quarter of fiscal 2026, international local case volume grew approximately 5%, highlighting solid engagement in markets where Sysco continues to deepen relationships with independent operators. This mix is particularly important as local customers typically carry more attractive economics and tend to be less volatile than larger national accounts, supporting steadier performance over time.
Margin expansion has been another defining feature of the segment’s progress. International gross margin increased by 43 basis points to 20.8%, reflecting disciplined pricing, strategic sourcing and improved supply-chain execution. Management emphasized that these gains were achieved while continuing to invest in the business, underscoring the scalability of Sysco’s operating model outside the United States.
Profit growth trends further reinforce the importance of the international segment. Adjusted operating income increased 13.1%, marking the eighth straight quarter of double-digit profit growth. Operational consistency across geographies has played a key role in this performance. Every major international region contributed to growth, supported by higher service levels, reduced product shrink and better productivity across the supply chain.
Overall, Sysco’s international business appears to be evolving from a supporting segment into a more durable growth driver. With improving margins, consistent profit growth and broad-based regional execution, the segment is increasingly strengthening the Zacks Rank #3 (Hold) company’s diversification and reinforcing the quality of its long-term earnings profile.
Shares of SYY have plunged 4.1% in the past six months compared with the industry’s decline of 12.8%.
Image Source: Zacks Investment Research
3 Consumer Staple Stocks to Consider
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The Zacks Consensus Estimate for Vita Coco's current fiscal-year sales and earnings implies growth of 18% and 15%, respectively, from the year-ago reported figures. Vita Coco delivered a trailing four-quarter earnings surprise of 30.4%, on average.
Monster Beverage Corporation (MNST - Free Report) engages in the development, marketing, sale and distribution of energy drink beverages and concentrates in the United States and internationally. MNST currently sports a Zacks Rank #1.
The Zacks Consensus Estimate for Monster Beverage's current fiscal-year sales and earnings indicates an increase of 9.7% and 22.8%, respectively, from the year-ago actuals. MNST delivered a trailing four-quarter earnings surprise of 5.5%, on average.
United Natural Foods, Inc. (UNFI - Free Report) distributes natural, organic, specialty, produce and conventional grocery and non-food products in the United States and Canada. At present, United Natural sports a Zacks Rank of 1.
The Zacks Consensus Estimate for United Natural’s current fiscal-year sales and earnings suggests growth of 1% and 187.3%, respectively, from the year-ago reported figures. UNFI delivered a trailing four-quarter earnings surprise of 52.1%, on average.
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Is Sysco's International Business Becoming a Key Growth Driver?
Key Takeaways
Sysco Corporation’s (SYY - Free Report) international business is emerging as a more meaningful contributor to the company’s overall performance, supported by steady execution and improving fundamentals. The segment is gaining traction as a structurally stronger growth engine, offering both sales momentum and improving profitability across regions.
A notable strength within the international business has been the continued shift toward local customers. In the first quarter of fiscal 2026, international local case volume grew approximately 5%, highlighting solid engagement in markets where Sysco continues to deepen relationships with independent operators. This mix is particularly important as local customers typically carry more attractive economics and tend to be less volatile than larger national accounts, supporting steadier performance over time.
Margin expansion has been another defining feature of the segment’s progress. International gross margin increased by 43 basis points to 20.8%, reflecting disciplined pricing, strategic sourcing and improved supply-chain execution. Management emphasized that these gains were achieved while continuing to invest in the business, underscoring the scalability of Sysco’s operating model outside the United States.
Profit growth trends further reinforce the importance of the international segment. Adjusted operating income increased 13.1%, marking the eighth straight quarter of double-digit profit growth. Operational consistency across geographies has played a key role in this performance. Every major international region contributed to growth, supported by higher service levels, reduced product shrink and better productivity across the supply chain.
Overall, Sysco’s international business appears to be evolving from a supporting segment into a more durable growth driver. With improving margins, consistent profit growth and broad-based regional execution, the segment is increasingly strengthening the Zacks Rank #3 (Hold) company’s diversification and reinforcing the quality of its long-term earnings profile.
Shares of SYY have plunged 4.1% in the past six months compared with the industry’s decline of 12.8%.
Image Source: Zacks Investment Research
3 Consumer Staple Stocks to Consider
The Vita Coco Company, Inc. (COCO - Free Report) develops, markets and distributes coconut water products under the Vita Coco brand name in the United States, Canada, Europe, the Middle East, Africa and the Asia Pacific. COCO currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Vita Coco's current fiscal-year sales and earnings implies growth of 18% and 15%, respectively, from the year-ago reported figures. Vita Coco delivered a trailing four-quarter earnings surprise of 30.4%, on average.
Monster Beverage Corporation (MNST - Free Report) engages in the development, marketing, sale and distribution of energy drink beverages and concentrates in the United States and internationally. MNST currently sports a Zacks Rank #1.
The Zacks Consensus Estimate for Monster Beverage's current fiscal-year sales and earnings indicates an increase of 9.7% and 22.8%, respectively, from the year-ago actuals. MNST delivered a trailing four-quarter earnings surprise of 5.5%, on average.
United Natural Foods, Inc. (UNFI - Free Report) distributes natural, organic, specialty, produce and conventional grocery and non-food products in the United States and Canada. At present, United Natural sports a Zacks Rank of 1.
The Zacks Consensus Estimate for United Natural’s current fiscal-year sales and earnings suggests growth of 1% and 187.3%, respectively, from the year-ago reported figures. UNFI delivered a trailing four-quarter earnings surprise of 52.1%, on average.