United Natural Foods Inc. (UNFI) reported fourth-quarter fiscal 2026 adjusted earnings per share of $0.69, above the Wall Street estimate of $0.61 by $0.08, or 13.1%. Revenue was $7.64 billion, slightly below the $7.69 billion estimate by $50 million, or 0.65%, with total sales over $7.6 billion and down less than 1% year over year. The stock rose 1.66% in premarket trading to $44.66 from a previous close of $43.93, a gain of $0.73 per share. The shares are about 59.7% above their 52-week low of $27.97 and 21.7% below their 52-week high of $57.02, with a market capitalization of $2.72 billion and a 52.6% return over the past year.
Fourth-quarter adjusted EBITDA was $172 million, a 2.3% margin on net sales. Gross margin was 13.7%, up 30 basis points year over year, while free cash flow was $80 million and operating expenses were about 12.9% of net sales.
For fiscal 2026, total sales were $31.2 billion. Adjusted EBITDA rose 27% year over year to $701 million, near the top of guidance, and adjusted EPS of $2.65 came in above the high end of guidance. Free cash flow reached a record $323 million, or $84 million higher than fiscal 2025, while net debt fell below $1.6 billion, the lowest level since fiscal 2018. The company repurchased about 420,000 shares in the fourth quarter for approximately $21 million, and about 1.25 million shares for approximately $50 million during the fiscal year, at an average price of $40.15 per share.
Net leverage was 2.2 times, down 1.1 turns from the end of fiscal 2025 and reduced from 4 times in fiscal 2024. The current ratio was 1.33 and the free cash flow yield was 12%. The consensus analyst rating was Hold, with price targets ranging from $43 to $56.
UNFI said its target addressable market is approximately $90 billion and is expected to grow in low single digits over time. Natural products sales rose about 7%, with EBITDA increasing 19%. Conventional product EBITDA grew more than 50%, while underlying sales declined mid-single digits. Retail sales fell 8% due to planned strategic store actions and footprint optimization, and the same-store comp sales decline improved by about 150 basis points from the third quarter. Optimization actions impacted fourth-quarter sales by approximately 500 basis points, while short-term project work impacted sales by approximately 150 basis points.
For fiscal 2027, UNFI expects sales of $31.2 billion to $31.8 billion, up 1% at the midpoint, with first-quarter sales declining year over year before improving in the second half. Adjusted EBITDA is projected at $730 million to $780 million, with a midpoint of $755 million. Adjusted EPS is expected to be $3.00 to $3.50, with a midpoint of $3.25, and free cash flow is forecast at $275 million to $325 million. Capital spending is expected to be about $300 million, and leverage is expected to fall below 2.0 times by the end of fiscal 2027. The board authorized a new $200 million share repurchase program to replace the expiring program. A term loan was repriced from SOFR plus 475 basis points to SOFR plus 400 basis points, expected to save an additional $3 million annually in interest expense.
Chief Executive Officer Sandy Douglas said the company delivered fourth-quarter adjusted EBITDA of $172 million and is helping customers execute growth strategies to differentiate their shopping experiences and better compete with mass and discount retailers. He said UNFI has grown adjusted EBITDA to over $700 million, generated substantial free cash flow and reduced net leverage from 4 times in fiscal 2024 to 2.2 times in fiscal 2026. President and Chief Operating Officer Matteo Tarditi cited disciplined execution and solid expense management.
