Univar Inc. (UNVR - Free Report) announced that it has been selected by Axiom Foods, Inc. as preferred distributor in the United States. The deal includes the complete product line of Axiom Foods pea and rice proteins as well as other plant-based ingredients, which are usually found in nutritional beverages, snacks, bars and meat analogues.
Notably, Axiom Foods provide allergen-friendly and niche vegan products to formulators as higher number of consumers are demanding healthier end-use products. The company is committed to deliver consistent results for partners on the back of science, certifications and clinical trials.
Per Univar, Axiom Foods' ability to innovate and deliver soluble, neutral and allergen-free solutions to address consumer demand will lead to long-term mutual success. Moreover, Univar will provide market intelligence data and analytics, which will forecast trends as well as drive growth. The deal provides Univar the opportunity to team with a leading innovator of rice and pea protein as well as cater to customers’ demands.
Univar's shares have lost 21.4% in the past year compared with the industry’s 21.8% decline.
Univar provided an update on 2019 outlook in March, factoring the recently completed buyout of Nexeo Solutions that was closed on Mar 1, 2019.
For 2019, the company expects adjusted EBITDA in the range of $740-$760 million on a combined basis. The projected 10-month earnings from the Nexeo Chemicals business and realized synergies are at roughly $10 million. It expects to generate $300-$350 million in free cash flow, before one-time integration cost of roughly $70 million.
Zacks Rank & Key Picks
Univar currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the basic materials space are Kirkland Lake Gold Ltd. (KL - Free Report) , Rio Tinto plc (RIO - Free Report) and Materion Corporation (MTRN - Free Report) , each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Kirkland has an expected earnings growth rate of 8.8% for 2019. The company’s shares have surged 87.9% in the past year.
Rio Tinto has an expected earnings growth rate of 20.1% for the current year. The company’s shares have gained 16.4% in a year’s time.
Materion has an expected earnings growth rate of 12.6% for 2019. Its shares have gained 9.5% in a year’s time.
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