United Natural Foods stock surges after profit and sales rise above expectations, outlook raised

Shares of United Natural Foods Inc.
UNFI,
+1.10%
ran up 5.8% into five-month-high territory after the grocery wholesaler reported fiscal third-quarter profit and sales that rose above expectations, and boosted its full-year outlook. Net income for the quarter to April 30 was $67 million, or $1.10 a share, up from $48 million, or 80 cents a share, in the year-ago period. Excluding nonrecurring items, adjusted earnings per share increases to $1.10 from $1.00, beating the FactSet consensus of 97 cents. Sales grew 9.2% to $7.24 billion, above the FactSet consensus of $7.10 billion, with growth driven by inflation and new business from existing and new customers. Growth in cost of sales outpaced sales growth, rising 10.1% to $6.23 billion as gross margin contracted to 14.0% from 14.6%. For fiscal 2022, the company raised its guidance ranges for adjusted EPS to $4.65 to $4.90 from $4.20 to $4.50 and for sales to $28.8 billion to $29.1 billion from $27.8 billion to $28.3 billion. The stock has rallied 10.7% over the past three months through Monday, while the S&P 500
SPX,
+0.31%
has slipped 1.9%.