Why Performance Food Group Is Falling in Premarket: Ending US Foods Merger Discussions

Performance Food Group Company (PFGC) shares tumbled in premarket trading on Monday, November 24, 2025, falling 4.30% to $92.50 as of 8:18 AM EST, following the announcement that the company and US Foods have mutually agreed to terminate their information sharing process. The decision marks the end of merger discussions that had been ongoing since July 2025, when the two food distributors first began exploring a potential business combination.

The companies had entered into a formal information exchange agreement in September, but after a comprehensive evaluation of regulatory considerations and potential synergies, both parties decided to pursue their standalone strategies instead.

PFGC and US Foods End Two-Month Information Sharing Process

Performance Food Group and US Foods jointly announced the end of their potential merger discussions on Monday morning, approximately two months after they agreed to exchange sensitive financial information without violating antitrust laws. George Holm, Chairman and CEO of Performance Food Group, stated that following a comprehensive evaluation with independent financial and legal advisors, the company’s Board of Directors unanimously believes that executing their standalone strategic plan represents the clearest path to long-term stockholder value.

The decision comes despite activist investor Scott Ferguson joining PFG’s board in September and hedge fund Sachem Head Capital Management urging the food distributor to consider the merger.

The terminated deal would have combined two major players in the food distribution industry, with US Foods valued at $15.85 billion and Performance Food Group at $15.16 billion according to LSEG data. Holm emphasized that the strength of the company’s recently reported fiscal first quarter results and continued momentum supports confidence in driving value for stockholders independently.

The CEO had previously stated in August that the board determined there was “no basis” to engage with US Foods, though the company later reversed course and entered information sharing discussions.

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Market Cap Holds at $15.16B Despite Premarket Slide on Deal News

Performance Food Group shares closed at $96.65 on Thursday, November 21, representing a gain of 2.49% or $2.35, before dropping to $92.50 in premarket trading on Monday following the merger termination announcement.

The stock has demonstrated strong performance over the past year, with a one-year return of 11.86% compared to the S&P 500’s 11.00% return, and an impressive five-year return of 120.36% versus the benchmark’s 85.61%. Despite the premarket decline, the company maintains a market capitalization of $15.16 billion and trades at a trailing P/E ratio of 46.24.

The company reaffirmed its full fiscal year 2026 guidance, expecting net sales between $67.5 billion and $68.5 billion with Adjusted EBITDA in the range of $1.9 billion to $2.0 billion. For the second quarter of fiscal 2026, PFG anticipates net sales between $16.4 billion and $16.7 billion with Adjusted EBITDA of $450 million to $470 million.

Analyst sentiment remains positive with an average price target of $121.67, significantly above the current trading price, and 14 analysts rating the stock as “Strong Buy” or “Buy” as of November 2025.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.