What is the Employee Stock Purchase Plan (ESPP)? The ESPP is a great way to build extra savings and share in Sysco’s success as our stock value increases.*
Participating in the plan is easy. Your contributions are automatically deducted from your paycheck, and you don’t pay any brokerage fees to buy Sysco stock through the ESPP.
Become an Owner.
The Employee Stock Purchase Plan (ESPP) makes it easy for you to become an owner of the company by allowing you to purchase Sysco stock at a 15% discount.
Let Sysco Work for You.
You work hard for Sysco—let Sysco work for you! The ESPP can allow you to earn and save more in four ways:
- Discounted Price: On the day your stock is purchased, it will be worth more than you paid for it, since you get a 15% discount. As long as the stock price isn’t lower than your purchase price when you decide to sell it, you’ll make money.
- Potential Stock Price Growth: If the value of Sysco’s stock rises, and you sell your stock at a higher price than you paid for it, you make a profit. You can track the stock price by looking for ticker symbol SYY on the New York Stock Exchange.
- Dividends: During the time you own Sysco stock, you also have the opportunity to receive dividends on the stock you purchase.
- Preferred Tax Treatment: US associates may benefit from a lower tax rate on any gain when selling stock if the shares are held for two years or longer.
*Like other stock investments, the value of Sysco shares will fluctuate with market conditions, going up or down. The information on this site does not constitute investment or tax advice, nor does it guarantee that the value of Sysco stock will increase. Please consult your financial advisor in order to understand the financial risks and applicable tax considerations associated with this program and to decide if participation is right for you.
How Does It Work?
Here’s a fictional example showing how ESPP plans work:**
ABC Company offers an Employee Stock Purchase Plan just like Sysco’s. Rick enrolled in the ABC Company ESPP shortly after he joined ABC Company in November of 2014. He chose to contribute 4% of his eligible pay, which was $50,000. His $2,000 annual election ($50,000 x .04 = $2,000) equaled $500 per quarterly offering period ($2,000/4 = $500).
First offering period
The first quarterly ESPP offering period began January 1, 2015, and ended on March 31, 2015, when the closing price of ABC stock was $23.53 per share. At the end of the quarter, the plan allowed Rick to purchase ABC stock at a 15% discount on the closing stock price. So, his purchase price was $20.00 ($23.53 x .85). His $500 ESPP contribution bought 25 shares of ABC stock that quarter ($500/$20 per share = 25 shares).
At time of sale
When Rick later decided to sell his ABC stock, the stock price was $25.88, and he received $647.00 (25 shares x $25.88 per share). During the time he held the stock, Rick also received dividends of $1 per share, or an additional $25. That’s a total profit of $172 on his initial investment of $500 ($147 gain on stock plus $25 in dividends).
|Q1 2015 Stock Purchase||Future Stock Sale|
|Rick’s ESPP Contribution||$500|
|Purchase Price||$20.00 per share|
|Total ABC Shares||25 shares||25 shares|
|Sale Price||$25.88 per share|
|Cash for Stock Sold||$647|
The illustration above shows Rick’s profit for stock purchased during just one quarterly offering period. He continued to participate, collecting dividends and watching his savings grow. He plans to sell his stock when the price is right.
**This simple example is for illustrative purposes only and is not intended to predict the future returns for Sysco stock or any other investment.