WFM’s recent top line performance
Whole Foods Market (WFM) will report its fiscal 3Q17 results on July 26, 2017. The premium organic retailer is expected to post top line growth of 0.6% YoY (year-over-year) in fiscal 3Q17, making it the slowest growth quarter in the 33 quarters since the 2009 recession.
In comparison, WFM’s sales rose at an average of ~12% between fiscals 2010 and 2014.
The organic retailer’s same-store sales, which were once the envy of the entire grocery sector, have stayed negative for the past seven consecutive quarters. Its sales comps fell 2.4% and 2.5%, respectively, in fiscals 1Q17 and 2Q17.
The company doesn’t foresee any improvement in comps and growth in the current year. It expects its fiscal 2017 sales comps to fall 2.5%. YTD (year-to-date), its comps have fallen 2.6%.
WFM’s total sales are expected to rise 1% in fiscal 2017. Its YTD sales have risen 1.5% YoY to $8.7 billion. However, WFM’s management aims to return to positive comps starting in fiscal 2018. For fiscal 2020, the company has set a target of 2% comps growth.
Supermarket chain Kroger’s (KR) top line rose 4.9% YoY to $36.3 billion when it reported its 1Q17 results in mid-June. Its same-store sales excluding fuel fell 0.2%, staying negative for the second consecutive quarter.
SUPERVALU’s (SVU) retail business posted a 3.6% fall in sales in its most recently reported quarter. The company expects ongoing headwinds to continue to affect its identical sales. It expects its sales to stay negative during the year.
ETF investors seeking to add exposure to Whole Foods can consider the First Trust Consumer Staples AlphaDEX ETF (FXG), which invests 4.7% of its portfolio in the company.