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Sprouts Farmers Markets Beats by $0.01, Reports in-line Sales

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Sprouts Farmers beats on the bottom line, reports in-line top line

The Phoenix-based Sprouts Farmers Market (SFM) reported results for 1Q18 on May 3. The value-oriented organic and natural food retailer did better than bottom-line expectations and reported in-line sales during the quarter.

Its total revenue increased 13.8% YoY (year-over-year) to $1.28 billion. Adjusted earnings per share expanded 51.5% YoY to 50 cents, one cent more than Thomson Reuters I/B/E/S Estimates. Read the next two parts of this series for a quick look at the company’s 1Q18 revenue drivers and profitability.

The company lowered its full-year sales outlook, which triggered a fall in its stock price. Its shares closed 13% lower on May 3. The company is now sitting at a YTD (year-to-date) loss of around 13%. Read Part 4 of this series for a view of SFM’s revised guidance and stock price movement.

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About Sprouts Farmers Market

Established in 2002, Sprouts Farmers Market (SFM) operates as a value-oriented healthy grocery store offering a range of natural and organic foods. The company operates 290 stores in 16 US states (as of May 1). It follows a small-box format with an average store size of 28,000 to 30,000 square feet, about half the size of Whole Food stores and one-third the size of Kroger’s (KR) combination stores.

Valuations overview

Sprouts Farmers is currently trading at a one-year forward earnings multiple of 17.2x versus a three-year average of 24x. The company touched the lowest point of its 52-week price-to-earnings ratio after the results.

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