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DAYVILLE, Conn. -- Shares of United Natural Foods Inc. climbed 6.9 percent in price Friday, after a Bank of America analyst upgraded the company from "buy" to "neutral" with a $32 price target.
The analyst, Scott A. Mushkin, upgraded his recommendation on the organic food distributor after it appointed of a new chief executive who the analyst said is likely to strengthen the company's relationship with Whole Foods Market, its biggest customer.
UNFI's shares went up $1.74 to $27.11 in afternoon trading on the Nasdaq Friday. Over the past year, shares have traded between $24 and $36.
The company's new c.e.o., Michael Funk, has had a long association with customer Whole Foods. UNFI's previous president and c.e.o., Steven H. Townsend, left in October. Funk's appointment was a return engagement; he had run UNFI in the past.
According to a note written by Mushkin, Funk will spearhead UNFI's expansion into such "underpenetrated markets" as Texas, Southern California, and foodservice. Mushkin also wrote that solid sales growth should mitigate the effect of high fuel costs.
Whole Foods' shares also went up Friday, rising $1.65 to $153.78 on the Nasdaq.
In other UNFI news, the company said that during a board of directors meeting last week, Thomas B. Simone, lead independent director since December 2003 and a board member since December 1996, was elected chairman. Simone previously served as chairman from December 1999 to December 2002. UNFI's board has seven members, five of whom are independent.
The company additionally promoted Richard Antonelli from president of United Distribution to e.v.p., c.o.o., and president of distribution; Daniel V. Atwood from s.v.p. of marketing to e.v.p., c.m.o., and president of United Natural Brands; and Rick D. Puckett from v.p., c.f.o., and treasurer to e.v.p., c.f.o., and treasurer.