Whole Foods Market, Inc. (NASDAQ:WFM)

CAPS Rating: 4 out of 5

Whole Foods brings the world of natural and organic foods into the supermarket format.

Recs

5
Player Avatar 25mlinlc (< 20) Submitted: 5/26/2014 10:23:30 AM : Underperform Start Price: $37.87 WFM Score: -0.16

WFM is commonly referred to as "Whole Paycheck". Sprouts Farmers Market and Trader Joes are competitors that are taking in foot traffic at a faster pace than WFM in the Albuquerque area. While visiting stores, I did a cost comparison. Noting that the different stores carried different brands of the same item, equivalent amounts of the same item over all were less expensive at Sprouts and Trader Joes. The percentage of shoppers that do not care about price and simply prefer WFM is too small and not growing. Therefore, I believe cost conscious consumers will gravitate to WFM's competition. Comparable store expansion in the Albuquerque area proves this out. To compete for growth, WFM would have to lower prices and therefore lose profits.

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