Wall Street Zen Downgrades Chefs' Warehouse (NASDAQ:CHEF) to Hold

Key Points

• Wall Street Zen downgraded Chefs' Warehouse from buy to hold, adding to a mixed analyst backdrop for the stock.
• Despite the downgrade, recent quarterly results were strong: Chefs' Warehouse reported $0.40 EPS versus estimates of $0.23 and $1.06 billion in revenue, above forecasts, with revenue up 11.4% year over year.
• The stock has climbed near its 52-week high, opening at $90.75 versus a high of $92.10, even as insiders sold shares and institutions continued to hold the vast majority of the company.

Chefs' Warehouse (NASDAQ:CHEF - Get Free Report) was downgraded by equities research analysts at Wall Street Zen from a "buy" rating to a "hold" rating in a research report issued to clients and investors on Saturday.

CHEF has been the topic of a number of other reports. UBS Group decreased their target price on Chefs' Warehouse from $83.00 to $80.00 and set a "buy" rating on the stock in a report on Thursday, April 23rd. Benchmark lifted their target price on Chefs' Warehouse from $84.00 to $90.00 and gave the company a "buy" rating in a research report on Thursday, April 30th. Weiss Ratings downgraded Chefs' Warehouse from a "buy (b-)" rating to a "hold (c+)" rating in a research report on Friday, May 1st. Zacks Research upgraded Chefs' Warehouse from a "hold" rating to a "strong-buy" rating in a research report on Tuesday, May 12th. Finally, Morgan Stanley reiterated an "overweight" rating and set a $83.00 target price on shares of Chefs' Warehouse in a research report on Thursday, April 30th. One analyst has rated the stock with a Strong Buy rating, four have given a Buy rating and two have issued a Hold rating to the company's stock. According to data from MarketBeat.com, Chefs' Warehouse presently has an average rating of "Moderate Buy" and a consensus price target of $83.83.

Chefs' Warehouse Stock Performance

CHEF stock opened at $90.75 on Friday. The company has a market cap of $3.70 billion, a P/E ratio of 50.42 and a beta of 1.44. Chefs' Warehouse has a 1 year low of $53.20 and a 1 year high of $92.10. The company has a debt-to-equity ratio of 1.18, a current ratio of 2.18 and a quick ratio of 1.33. The stock's fifty day moving average price is $73.57 and its 200-day moving average price is $66.95.

Chefs' Warehouse (NASDAQ:CHEF - Get Free Report) last released its quarterly earnings results on Wednesday, April 29th. The company reported $0.40 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.23 by $0.17. The firm had revenue of $1.06 billion for the quarter, compared to the consensus estimate of $1.01 billion. Chefs' Warehouse had a return on equity of 15.54% and a net margin of 1.87%.The company's revenue for the quarter was up 11.4% on a year-over-year basis. During the same period last year, the business posted $0.25 EPS. On average, equities analysts forecast that Chefs' Warehouse will post 2.37 earnings per share for the current year.

Insider Buying and Selling at Chefs' Warehouse

In other Chefs' Warehouse news, CEO Christopher Pappas sold 125,000 shares of the firm's stock in a transaction dated Tuesday, May 5th. The stock was sold at an average price of $78.00, for a total transaction of $9,750,000.00. Following the sale, the chief executive officer directly owned 2,189,453 shares of the company's stock, valued at $170,777,334. This trade represents a 5.40% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, insider Christina Polychroni sold 4,500 shares of the firm's stock in a transaction dated Tuesday, May 19th. The shares were sold at an average price of $79.21, for a total value of $356,445.00. Following the sale, the insider directly owned 24,642 shares in the company, valued at approximately $1,951,892.82. This represents a 15.44% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. 11.10% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Chefs' Warehouse

A number of institutional investors and hedge funds have recently bought and sold shares of the business. Parallel Advisors LLC raised its holdings in Chefs' Warehouse by 98.7% during the first quarter. Parallel Advisors LLC now owns 926 shares of the company's stock valued at $55,000 after acquiring an additional 460 shares during the period. Argent Capital Management LLC bought a new stake in Chefs' Warehouse during the first quarter valued at about $546,000. California State Teachers Retirement System raised its holdings in Chefs' Warehouse by 27.2% during the first quarter. California State Teachers Retirement System now owns 44,406 shares of the company's stock valued at $2,640,000 after acquiring an additional 9,490 shares during the period. Royal Bank of Canada raised its holdings in Chefs' Warehouse by 23.9% during the first quarter. Royal Bank of Canada now owns 332,391 shares of the company's stock valued at $19,759,000 after acquiring an additional 64,090 shares during the period. Finally, Empowered Funds LLC bought a new stake in Chefs' Warehouse during the first quarter valued at about $275,000. 91.55% of the stock is owned by institutional investors.

Chefs' Warehouse Company Profile

Chefs' Warehouse, Inc is a specialty food distributor that supplies a broad range of high‐end ingredients and culinary products to professional chefs, restaurants, hotels, and other foodservice operators. Headquartered in Maspeth, New York, the company sources its portfolio from local artisans, boutique producers and leading global suppliers. Its core offerings include fresh and frozen proteins, specialty cuts of meat and seafood, handcrafted cheeses and charcuterie, seasonal produce, value‐added preparations, pantry staples and premium desserts and beverages.

The company operates a network of distribution centers strategically located in major metropolitan markets across North America.

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