Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Position Status | Return(%)* |
|---|---|---|---|---|---|---|---|---|
| 10 Mar, 26 | CHEF | Buy | USD 63.5 | USD 66.8 | USD 71.0 | 50 days | Closed |
12.03%
|
*Return(%) represent the percentage change between the entry price and exit price of the recommendation.
Data Powered by EOD Historical Data (“EODHD”).
The Chefs' Warehouse, Inc., together with its subsidiaries, distributes specialty food and center-of-the-plate products in the United States, the Middle East, and Canada. It offers specialty food products, such as artisan charcuterie, specialty cheeses, unique oils and vinegars, truffles, caviar, chocolate, and pastry products and center-of-the-plate products that includes custom cut beef, seafood, and hormone-free poultry, as well as produce and broadline food products comprising cooking oils, butter, eggs, milk, and flour. The company serves menu-driven independent restaurants, fine dining establishments, country clubs, hotels, caterers, culinary schools, bakeries, patisseries, chocolatiers, cruise lines, casinos, and specialty food stores. It markets its center-of-the-plate products directly to consumers through a mail and e-commerce platform. The Chefs' Warehouse, Inc. was founded in 1985 and is headquartered in Ridgefield, Connecticut.
Adjusted EBITDA Growth: Adjusted EBITDA improved to USD 258.3 million in FY25 from USD 219.0 million in FY24
Gross Profit Expansion: Gross profit increased to USD 1.00 billion in FY25 compared with USD 914.1 million in FY24
Elevated Capital Investment and Depreciation: Depreciation and amortization increased to USD 78.1 million in FY25 compared with USD 64.9 million in FY24
Rising Operating Expenses: Selling, general, and administrative expenses increased to USD 849.8 million in FY25 from USD 784.9 million in FY24
The company’s financial performance remains exposed to consumer discretionary spending cycles within the restaurant industry and volatility in food commodity prices, which could affect demand levels, pricing dynamics, and operating margins
| Entry Price | Support* | Target 1** | Target 2** |
|---|---|---|---|
| 63.5 | 56.0 | 66.8 | 71.0 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
**Target prices may vary by ±0.5% depending on market volatility.
Strong Revenue Expansion Driven by Organic Growth: During FY25, The Chefs’ Warehouse delivered strong top-line expansion supported by healthy demand from upscale-casual and fine dining customers across its operating markets. Net sales increased to USD 4.15 billion in FY25 compared with USD 3.79 billion in FY24, reflecting sustained organic growth across specialty food categories, customer acquisition, and increased menu placements. Organic sales expansion remained a key contributor to revenue growth, driven by increased order volumes, pricing adjustments reflecting inflation in certain food categories, and incremental contributions from acquisitions.
Expansion in Gross Profit Supported by Volume and Pricing: The company reported solid improvement in profitability metrics during FY25 as gross profit increased to USD 1.00 billion compared with USD 914.1 million in FY24. The increase was primarily driven by higher sales volumes, price inflation across specialty products, and the contribution from acquired businesses. Despite the increase in gross profit dollars, margin dynamics remained influenced by category mix and product cost inflation across food inputs and logistics.
Operating Expense Growth Linked to Expansion Initiatives: Selling, general, and administrative expenses increased to USD 849.8 million in FY25 from USD 784.9 million in FY24. The increase was largely attributable to higher compensation and benefits associated with salesforce expansion, increased depreciation from investments in distribution facilities and fleet infrastructure, and elevated self-insurance costs. These investments were undertaken to support the company’s growing customer base and geographic expansion.
Earnings Growth and Operational Leverage: Operational profitability improved during FY25, with adjusted EBITDA increasing to USD 258.3 million compared with USD 219.0 million in FY24, reflecting continued operating leverage and scaling of the distribution network. Adjusted EBITDA margin expanded to 6.2% in FY25 from 5.8% in FY24, highlighting improved efficiency across route consolidation initiatives, procurement optimization, and technology-enabled sales processes.
Net Income Growth and Earnings Expansion: The company reported net income of USD 72.4 million in FY25 compared with USD 55.5 million in FY24, reflecting improved operating performance and higher revenue scale. Adjusted net income increased to USD 82.6 million in FY25 from USD 62.2 million in FY24, while diluted adjusted earnings per share rose to USD 1.90 in FY25 from USD 1.47 in FY24. The increase in profitability reflects strong demand conditions within the company’s core chef-driven restaurant customer base and operational efficiencies across the distribution network.
Balance Sheet Strengthening and Capital Allocation: During FY25, the company maintained disciplined capital allocation while improving its leverage profile. Net debt declined to approximately USD 529.5 million at year-end FY25 compared with USD 557.8 million in FY24, resulting in net debt leverage declining to approximately 2.1x from 2.5x in the prior year. The company also generated free cash flow of approximately USD 88 million in FY25 and repurchased approximately USD 15 million of common stock as part of its share repurchase program.
Operational Efficiency and Strategic Growth Initiatives: Operational initiatives during FY25 focused on improving distribution efficiency and scaling high-growth markets. The company continued implementing facility consolidations, route optimization, and supply chain improvements that enhanced productivity metrics such as gross profit per route and adjusted EBITDA per employee. These initiatives are expected to support long-term operating leverage as the company expands into new geographic markets and strengthens its specialty food distribution platform.
Considering recent key business, financial updates, current trading levels, and key business risks, a ‘Buy’ recommendation has been given to The Chefs' Warehouse, Inc (NASDAQ: CHEF) at the closing market price of USD 63.50, as on Mar 09, 2026
Data Powered by EOD Historical Data (“EODHD”).
Sector: Consumer Defensive Industry: Food Distribution
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| CHEF The Chefs Warehouse Inc |
-0.955 1.00% | 94.62 | 38.89 | 29.33 | 0.64 | 4.42 | 0.85 | 15.80 |
| SYY Sysco Corporation |
-0.27 0.33% | 80.51 | 20.66 | 16.72 | 0.48 | 17.38 | 0.63 | 12.66 |
| JRONF Jerónimo Martins SGPS S.A |
- -% | 23.70 | 18.10 | 22.22 | 0.53 | 5.17 | 0.62 | 8.78 |
| JRONY Jeronimo Martins SGPS SA ADR |
-0.25 0.66% | 37.64 | 19.98 | 23.09 | 0.54 | 5.70 | 0.62 | 8.86 |
| USFD US Foods Holding Corp |
-0.68 0.72% | 94.35 | 25.21 | 13.79 | 0.31 | 2.33 | 0.44 | 11.80 |
Data Powered by EOD Historical Data (“EODHD”).
Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels as on March 10, 2026. The reference data in this report has been partly sourced from REFINITIV.
Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned has been achieved and is subject to the factors discussed above.
Note 4: StockNextt reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
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Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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