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Sprouts Delivers 15% Top Line Growth in 2017

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SFM reports a 16% jump in 4Q17 top line

Sprouts Farmers Market (SFM) reported a 16.1% YoY (year-over-year) rise in total sales to $1.1 billion during 4Q17. The organic and natural food retailer exceeded Wall Street’s expectations by $1 million. It outperformed consensus forecasts in all four quarters of 2017.

The company’s growth was driven by strong comps and a healthy performance in its new stores, both of which we’ll discuss in the next article.

“Sprouts’ position of strength continues to grow, demonstrated by 4.6% comparable store sales growth for the fourth quarter of 2017 and exceptional EPS growth of 22% for the year,” said Amin Maredia, the CEO of Sprouts Farmers Market.

For the full year, Sprouts’ sales rose 15.3% YoY to $4.7 billion. Investors looking to invest in SFM through ETFs can choose to invest in the iShares Morningstar Small-Cap Growth ETF (JKK). SFM has a weight of ~0.5% in JKK.

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Discussing competitors

Supermarket giant Kroger’s (KR), which is expected to report its fourth-quarter results on March 8, 2018, is expected to post an 11% rise in its top line to $30.7 billion. The company is now among the top organic-produce-selling grocers in the country. It recently announced that it touched $1 billion in organic sales. According to market research company IRI, the US organic produce market had a value of $5 billion in 2016.

Wholesaler and retailer SuperValu’s (SVU) retail sales plunged for the tenth straight quarter after it reported its third-quarter results on January 10, 2018. Its retail sales fell 4.1% to $1.0 billion. However, its total sales rose 31.1% to $3.9 billion driven mostly by its recent acquisition of Unified Grocers.

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