Sysco Corporation (SYY) Declined on Investor Worry About the Restaurant Macro Environment, Consumer Weakness

Diamond Hill Capital, an investment management company, released its “Large Cap Fund” fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. Equity markets continued their upward momentum in Q4, with the Russell 1000 Value Index increasing 3.8%. The information technology (+11%) and communication services (+9%) sectors are leading the rally, driven by AI optimism. The growth areas of the market accounted for the majority of the Index’s return in Q4. The firm maintains a cautious stance toward AI-driven market enthusiasm and believes that, fundamentally stable, high-quality, cash-generative businesses present attractive opportunities. Against this backdrop, the Fund returned 1.41% in the quarter, lagging the Russell 1000 Value Index’s 3.8% return. In addition, you can check the Fund's top five holdings to see its best picks for 2025.

In its fourth-quarter 2025 investor letter, Diamond Hill Large Cap Fund highlighted Sysco Corporation (NYSE:SYY) as one of the leading performance detractors. Sysco Corporation (NYSE:SYY) is a leading food service company. On February 2, 2026, Sysco Corporation (NYSE:SYY) stock closed at $82.86 per share. Sysco Corporation (NYSE:SYY) delivered a 13.48% return in the past month, and its shares are up 16.05% over the past twelve months. Sysco Corporation (NYSE:SYY) has a market capitalization of $39.684 billion.

Diamond Hill Large Cap Fund stated the following regarding Sysco Corporation (NYSE:SYY) in its fourth quarter 2025 investor letter:

"Shares of food products manufacturer Sysco Corporation (NYSE:SYY) declined given investor concern surrounding the macro environment for restaurants and the weakening consumer. However, we maintain our conviction in the company’s market-leading position and economies of scale with its buying power, wide assortment of products and route density."

Sysco Corporation (NYSE:SYY) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 54 hedge fund portfolios held Sysco Corporation (NYSE:SYY) at the end of the third quarter, up from 45 in the previous quarter. Sysco Corporation (NYSE:SYY) announced second-quarter of fiscal 2025 revenue of $21 billion, reflecting a 3% year-over-year growth. While we acknowledge the potential of Sysco Corporation (NYSE:SYY) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Sysco Corporation (NYSE:SYY) and shared a list of best food stocks to buy in 2026. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.