Whole Foods Market (WFM, Financial) announced their second quarter’s earnings result reporting an EPS of $0.43 per share for the quarter, which met the analyst estimate. Whole Foods Market’s revenue reached $3.6 billion for this quarter compared to the estimate of $3.7 billion which analysts expected the company to hit. Revenue rose 9.8% when compared on a year-over-year basis.
Whole Foods Market Inc continued its impressive earnings streak for a fourth consecutive quarter. The company’s EPS rose 13.2% from the year-ago similar quarter. Company revenue rose trickling down to the company’s bottom line and thereby improving its EPS.
The company owns and runs 417 stores while having opened 11 outlets during the previous quarter. Whole Foods Market believes that there is potential to open 1,200 stores in the U.S. in its journey ahead and expects to cross the 500 store mark by the 2017 fiscal year.
A word from above
Walter Robb, Whole Foods Market Inc CEO, comments on the situation saying- “The comps, definitely we lost momentum in the winter, but if you look at some of that was self-inflicted with our cannibalization. Some of these big markets, but there’s no question they were little short of expectations. But when you look within the numbers you see 10 percent growth, you see 11 percent square footage growth. You see $1,000 a square foot on the sales and you see 40 new stores coming in this year with a lot of momentum there. So, I think really what you see is a marketplace that’s evolving; Whole Foods is evolving with it.”
He continued- “We continue to think we have the right steps in place to grow the company with our price investments, our technology investments, our marketing investments and we see an opportunity to grow this bigger market with the new, exciting format and brand.”
Analysis
Analysts are giving Whole Foods Market Inc a ‘BUY’ rating. This decision is based by comparing the number of strengths compared to its weaknesses. Whole Foods Inc’s strengths can be seen in multiple areas, like revenue growth, increase in EPS, a net income increase, expanding profit margins and consistent cash flow from operations. The company’s strength outweigh certain weaknesses show by Whole Foods such as bad performance in the stock market. The company’s gross profit margin for the second quarter of its fiscal year 2015 is basically unchanged. With rising sales and net income escalating, the company quick ratio of 0.84 shows a low ability to cover short-term cash needs. The company’s liquidity state suggests that financial development might come up within a few quarters down the line.
