United Natural Foods, Inc. UNFI shares have gained 150.4% in the past year, surpassing the industry’s decline of 7.8% and the broader S&P 500 index’s growth of 6.5%. This strong performance underscores the company’s solid business strategies and market positioning.

UNFI Stock Past Year Performance

Image Source: Zacks Investment Research

UNFI stock remains above its 200-day moving average, a sign of underlying strength and bullish sentiment. This technical positioning reinforces investor confidence in the company’s financial stability and outlook.

Key Strategic Drivers Behind UNFI’s Strong Momentum

UNFI continues to benefit from strong momentum in the natural and organic food space, as consumers increasingly seek out healthier, more sustainable options. In line with these trends, the company announced in January 2025 that it had taken steps to realign wholesale business into two product-focused divisions, one dedicated to conventional grocery and the other focused on natural, organic, specialty and fresh offerings. This shift enhances focus, agility and customer alignment across its portfolio.

Lean management principles have become a cornerstone of the company’s operational strategy, driving cost savings and efficiency improvements. In the second quarter of fiscal 2025, operating expenses were 12.6% of net sales compared with 13% of net sales in the previous year quarter. The company achieved a 40-basis-point (bps) reduction in operating expenses as a percentage of sales, underscoring its disciplined approach to cost control. 

This cost discipline, coupled with steady revenue growth, has translated into stronger financial performance. In the fiscal second quarter, adjusted EBITDA increased nearly 13.3% year over year to approximately $145 million, while the EBITDA margin expanded 13 bps to 1.8%. Favorable below-the-line items further contributed to earnings growth, with adjusted earnings per share (EPS) jumping 214.3% to 22 cents from 7 cents in the prior-year period, reflecting stronger profitability.

UNFI is making meaningful progress in optimizing its distribution network to enhance efficiency and support long-term growth. In mid-February, the company consolidated its distribution center in Fort Wayne, IN, redirecting volume to more modern centers nearby. The previously closed Billings DC is under contract, with the sale expected to close in the fourth quarter of fiscal 2025. Proceeds will help reduce net debt. These strategic moves reflect UNFI’s focus on driving operational efficiency and financial flexibility.

Estimate Revisions Favoring UNFI

Reflecting positive sentiment around United Natural, the Zacks Consensus Estimate for earnings per share has seen upward revisions. Over the past 60 days, the consensus estimate has risen 6 cents to 82 cents for the current fiscal and 16 cents to $1.39 for the next fiscal. These estimates indicate year-over-year growth rates of 485.7% and 69.5%, respectively.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Image Source: Zacks Investment Research

What Should be Your Move on UNFI?

United Natural Foods has demonstrated solid progress through disciplined cost control, operational streamlining and strong earnings momentum. With continued strength in the natural and organic category, and positive estimate revisions, UNFI appears well-positioned for further upside. For investors seeking a growth-oriented opportunity, the company’s strong recovery and strategic focus make it a stock worth watching. At present, UNFI carries a Zacks Rank #2 (Buy).

Other Stocks to Consider

Post Holdings, Inc. POST operates as a consumer-packaged goods holding company in the United States and internationally and presently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 

The Zacks Consensus Estimate for Post Holdings’ current financial-year sales and earnings indicates growth of 0.3% and 2.2%, respectively, from the year-ago numbers. Post Holdings delivered a trailing four-quarter earnings surprise of 22.3%, on average.

Utz Brands UTZ engages in the manufacture, marketing and distribution of snack foods in the United States and presently carries a Zacks Rank of 2. Utz Brands delivered a trailing four-quarter earnings surprise of 8.8%, on average.

The Zacks Consensus Estimate for Utz Brands’ current financial-year sales and earnings indicates growth of 1.2% and 10.4%, respectively, from the year-ago numbers.

BRF S.A. BRFS raises, produces and slaughters poultry and pork for processing, production and sale of fresh meat, processed products, pasta, margarine, pet food and other products. It currently carries a Zacks Rank of 2. BRFS delivered a trailing four-quarter earnings surprise of 9.6%, on average.

The Zacks Consensus Estimate for BRF S.A.'s current fiscal-year sales indicates growth of 0.3% from the prior-year levels.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

BRF S.A. (BRFS) : Free Stock Analysis Report

United Natural Foods, Inc. (UNFI) : Free Stock Analysis Report

Post Holdings, Inc. (POST) : Free Stock Analysis Report

Utz Brands, Inc. (UTZ) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research