Baron Funds Comments on United Natural Foods Inc.

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Aug 19, 2015

United Natural Foods, Inc. (UNFI, Financial), the leading distributor of natural, organic and specialty products, reported decelerating sales growth trends. Many players in the sector reported similar trends and all the stocks declined over concerns that growth has crested. We believe that we are still in the early phase of growth in the natural and organic foods industry and the near-term issues have to do with competition and market share. We see great growth prospects for the company’s Tony’s acquisition, which puts United into distribution of fresh and perishable foods. It doubles the addressable market opportunity for the company. And so far so good in integrating the product offerings and growing this sector.

From Baron Funds’ second quarter 2015 commentary.