Whole Foods Market (WFMI) with a strong brand image offers investors one of the strongest growth profiles in the industry, and the stock is poised to surge as the demand for natural and organic products improves. The company is also revamping its pricing strategy and concentrating more on value offerings while maintaining healthy margins.
The stringent cost-control measures, effective inventory management and improved store-level performance are driving earnings growth. The company, in the wake of better-than-expected first-quarter 2011 results now expects sales growth between 10.7% to 12.8% and bottom-line in a range of 23% to 26% in fiscal 2011.
Moreover, a prudent capital investment is also translating into improved cash flows with lower debt level and a healthy balance sheet. We have a long-term Outperform recommendation on the stock. Our target price of $65.00, 35.9X 2011 EPS, reflects this view.
WHOLE FOODS MKT (WFMI): Free Stock Analysis Report
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