Sysco (SYY) PT Lowered at Piper Sandler; 'We would therefore not be buyers on this pullback'

Piper Sandler analyst Brian Mullan lowered the price target on Sysco (NYSE: SYY) to $77.00 (from $83.00) while maintaining a Neutral rating.

The analyst commented: "Last week, SYY announced that is has entered into a definitive agreement to acquire Restaurant Depot for total consideration of $29.1 billion. For SYY, this marks an expansion into the ~$60 to $70 billion “Cash & Carry” channel of the broader ~$380 billion U.S. total Foodservice market. For our part, we were quite surprised by this announcement; and we’d probably separate our surprise into a couple of different areas, which we elaborate on below. Overall, however, we note that we are not huge fans of this transaction; which seems to align with the market’s view as well, judging by the share price reaction. For our part, we think the market reaction was fairly rational, and we would therefore not be buyers on this pullback. With this note, we reaffirm our Neutral rating on SYY."

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