Sprouts Farmers Market’s 2Q17 Earnings Beat: Top, Bottom Lines Up

Sonya Bells - Author

Aug. 8 2017, Updated 8:11 a.m. ET

Series snapshot

Phoenix, Arizona–based Sprouts Farmers Market (SFM) reported its 2Q17 results on August 3, 2017. As in 1Q17, the company came in ahead of Wall Street’s revenue and earnings expectations.

Total sales for SFM increased 15% YoY (year-over-year) to $1.2 billion, $17.0 million more than consensus estimates. Its earnings per share (or EPS) increased 16% YoY to $0.29, beating the consensus by $0.04.

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Valuations overview

Sprouts Farmers Market (SFM) is currently trading at a one-year forward earnings multiple of 24.0x versus its three-year average of 28.5x.

The company trades at a premium to supermarket peers Kroger (KR) and Supervalu (SVU), which are valued at 12.0x and 9.8x, respectively. Whole Foods Market (WFM) is the most expensive grocer with a one-year forward earnings multiple of 30.6x.

Investors looking for exposure to SFM through ETFs can choose to invest in the PowerShares Dynamic Food & Beverage Portfolio ETF (PBJ). SFM has am ~2.9% weight in PRJ.

About Sprouts Farmers Market

Established in 2002, Sprouts Farmers Market (SFM) operates as a value-oriented healthy grocery retailer offering a range of natural and organic foods. The company operates close to 280 stores in 15 states.

In this series, we’ll perform an overview of Sprouts Farmers Market’s 2Q17 results. We’ll discuss the company’s financial performance, key revenue drivers, stock market performance, Wall Street recommendations, and current valuations.


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