UPDATE: Jefferies Initiates Coverage on SYSCO on Weak Demand, Persistent Margin Risks

In a report published Tuesday, Jefferies analyst Mark Wiltamuth initiated coverage on SYSCO Corporation (NYSE: SYY) with a Hold rating and $30.00 price target.

In the report, Jefferies noted, “While Sysco enjoys scale advantages as the largest player in the US food-service industry, restaurant industry traffic trends have been sluggish and we are concerned that margins could continue to disappoint. While the operating environment and margin outlook is not encouraging, the company's 3.7% dividend yield provides support while investors wait for fundamentals to turn.”

SYSCO Corporation closed on Monday at $31.63.