Fiscal 4Q16 Earnings: Whole Foods Market Reports Earnings Beat



Series snapshot

Based in Austin, Texas, Whole Foods Market (WFM) reported its results for fiscal 4Q16 on November 2, 2016. The company’s fiscal 4Q16 ended on September 25, 2016.

The company reported sales of $3.5 billion in fiscal 4Q16, which is in line with the consensus estimates. Earnings per share fell 6.7% to $0.28, beating Wall Street estimates by $0.04.

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Valuations summary

Whole Foods Market (WFM) is currently trading at a one-year earnings multiple of 19.8x, operating in the middle of its 52-week price-to-earnings (or PE) range of 15.7x–22.7x. The company trades at a premium to supermarket chains Kroger (KR) and Supervalu (SVU), which are valued at 14.4x and 7.2x, respectively.

However, Sprouts Farmers Market (SFM) trades at a premium to Whole Foods Market. WFM trades at a one-year forward PE of 22.2x.

ETF investors seeking to add exposure to Whole Foods Market can consider the Guggenheim S&P 500 Equal Weight Consumer Staples ETF (RHS), which invests ~2.6% of its portfolio in the company.

About Whole Foods Market

With total fiscal 2015 sales of $15.7 billion, Whole Foods Market (WFM) is the leading grocer and retailer of natural and organic foods in the US. The company was long considered a synonym for healthy food in the country.

However, the company’s popularity started to decline with the entry of mainstream food retailers like Kroger (KR), Costco (COST), and Walmart (WMT) into the organic food market. These companies attracted Whole Foods Market’s customers with similar products at competitive costs.

In this series, you can learn about the company’s fiscal 4Q16 performance, valuations, and stock market performance.


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