What to Expect Performance Food Group Stock This Week

The stock has a history of muted post-earnings reactions

facebook twitter linkedin

Performance Food Group Company (NYSE:PFGC) is a customer-centric food service distribution company in the United States. The company announced will be releasing third quarter earnings results on Wednesday, May 5 before market hours. Ahead of the event, we're going to dig into the stock's long and short-term viability. 

Performance Food Group has managed to beat earnings expectations on three out of the last four earnings reports. However, that's only resulted in one positive post-earnings move, a 4.1% gain back in February. In the last eight reports, PFGC has averaged a post-earnings move of 2.9%, regardless of direction. This time around, the options market is pricing in a slightly larger-than-usual move of 3.9%.  

Year-over-year, PFGC has doubled in value, culminating in a March 15 record high of $59.89. Since the, the shares have consolidated below $60, with their ascending 50-day moving average containing any sharper pullbacks in recent months.

PFGC Chart

There may yet be room for the stock to continue running. From a value perspective, Performance Food Group stock is shaping up to be a promising turnaround play due to its amazing revenue growth. In fiscal 2020, PFGC increased revenues by 27% to $25 billion from $19.7 billion in fiscal 2019, and have grown their top line by 50% since fiscal 2017. Furthermore, PFGC has already bumped its trailing 12 month revenue to $26.67 billion with the addition of the last two quarters, marking a 6% increase.

Where things get shaky for Performance Food Group is on the bottom line. In fiscal 2020, PFGC had $114 million in net losses, which has now extended to -$174.5 million over the past four quarters. In total, Performance Food Group's net income has decrease by $373.2 million since fiscal 2018.

However, the contrast between the company’s growing revenues and its declining net income is precisely what makes PFGC such an interesting turnaround play. Although there is a lot of risk involved when investing in a company with a downward net profit trajectory, the reward potential for Performance Food Group stock could be huge if the company can begin generating profits.


Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

Schaeffer's Daily Bulletin Offer


Special Offers from Schaeffer's Trading Partners