A strong stock as of late has been Chefs' Warehouse (CHEF). Shares have been marching higher, with the stock up 5.4% over the past month. The stock hit a new 52-week high of $68.59 in the previous session. Chefs' Warehouse has gained 35.7% since the start of the year compared to the 3.6% gain for the Zacks Consumer Staples sector and the -4.1% return for the Zacks Food - Miscellaneous industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on July 30, 2025, Chefs' Warehouse reported EPS of $0.52 versus consensus estimate of $0.45 while it beat the consensus revenue estimate by 1.47%.
For the current fiscal year, Chefs' Warehouse is expected to post earnings of $1.65 per share on $4.02 in revenues. This represents a 12.24% change in EPS on a 6.01% change in revenues. For the next fiscal year, the company is expected to earn $1.92 per share on $4.31 in revenues. This represents a year-over-year change of 16.36% and 7.03%, respectively.
Valuation Metrics
Though Chefs' Warehouse has recently hit a 52-week high, what is next for Chefs' Warehouse? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). The individual style scores for Value, Growth, Momentum and the combined VGM Score run from A through F. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Chefs' Warehouse has a Value Score of B. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 40.6X current fiscal year EPS estimates, which is a premium to the peer industry average of 16.4X. On a trailing cash flow basis, the stock currently trades at 20.8X versus its peer group's average of 9.3X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this is even more important than the company's VGM Score. Fortunately, Chefs' Warehouse currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Chefs' Warehouse passes the test. Thus, it seems as though Chefs' Warehouse shares could have a bit more room to run in the near term.
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The Chefs' Warehouse, Inc. (CHEF): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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