AccidentalStayAtHomeDad

CHEF Setup to Benefit from Vaccine and Stimulus News

Long
NASDAQ:CHEF   The Chefs' Warehouse, Inc.

Chefs Warehouse (CHEF), I believe, is uniquely set up to benefit from any vaccine news and government stimulus, provided that they can survive the remainder of this 2020 and Q1 2021-which I believe they will due to a good balance sheet.
CHEF is a specialty food distributor mostly specializing in restaurant sales and distribution. Unlike US Foods or Sysco they mainly service independent restaurants, fine dining, and country clubs-although they do service cruise lines, hotels, etc. Which hurt them in the short run, long term however they are primed for a comeback and are beginning to look like they are making a move. As can be seen on my chart CHEF has broken out above the 200, 100, 50, and 20 Day SMA as well as its major trend channels and created a lovely little pennant pattern.
On the balance sheet CHEF has $71.81M in levered FCF and total cash of $208.54 due to a revolving line of credit they can draw on. This gives them a current ratio of 3.25 where US Foods ($USFD) is 1.6, Sysco ($SYY) 1.74, and United Natural Foods ($UNFI) of 1.56. This puts, I believe, CHEF in a position to enter the post-Covid economy in a period of growth.
With the potential shift in business and the way the US does business from a distance staying permeant post-Pandemic Chef's Warehouse could largely benefit from the take-out/dine-out windfall from all those stay at home employees. While their competitors have a larger market share of institutional and retail food CHEF is more focused on center of the plate items that will transition well into a work from home culture of the future.

Disclaimer

The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.