Sprouts Farmers Market (NASDAQ:SFM) Shares Climb 9.1% - Still a Buy?

Key Points

• Sprouts Farmers Market shares rose 9.1% to about $54.22 on elevated trading volume, but remain below their 50-day and 200-day moving averages of $69.68 and $76.29.
• Analysts have broadly lowered their price targets following recent results; the consensus rating is “Hold” with an average target of $64.92. Ratings include five Buys, six Holds and three Sells.
• Quarterly revenue increased 4.7% year over year to $2.30 billion, though it narrowly missed estimates and EPS fell one cent short at $1.21. Insiders sold 46,041 shares worth roughly $3.46 million over the past quarter.

Shares of Sprouts Farmers Market, Inc. (NASDAQ:SFM - Get Free Report) were up 9.1% during mid-day trading on Monday. The company traded as high as $54.09 and last traded at $54.2230. 3,411,445 shares traded hands during mid-day trading, an increase of 38% from the average daily volume of 2,475,773 shares. The stock had previously closed at $49.70.

Wall Street Analysts Forecast Growth

A number of analysts have commented on SFM shares. Royal Bank Of Canada cut shares of Sprouts Farmers Market from an "outperform" rating to a "sector perform" rating and reduced their target price for the company from $111.00 to $49.00 in a report on Thursday. Wells Fargo & Company lowered their price objective on Sprouts Farmers Market from $100.00 to $60.00 and set an "overweight" rating on the stock in a research report on Thursday. Deutsche Bank Aktiengesellschaft dropped their price target on shares of Sprouts Farmers Market from $84.00 to $77.00 and set a "hold" rating for the company in a research report on Friday, September 25th. The Goldman Sachs Group cut their price target on Sprouts Farmers Market from $94.00 to $58.00 and set a "buy" rating for the company in a research note on Friday. Finally, JPMorgan Chase & Co. lowered their price objective on Sprouts Farmers Market from $90.00 to $58.00 and set an "overweight" rating on the stock in a research report on Thursday. Five research analysts have rated the stock with a Buy rating, six have given a Hold rating and three have assigned a Sell rating to the company's stock. Based on data from MarketBeat, the stock presently has an average rating of "Hold" and a consensus price target of $64.92.

Sprouts Farmers Market Stock Performance

The business's fifty day moving average is $69.68 and its two-hundred day moving average is $76.29. The stock has a market capitalization of $5.09 billion, a PE ratio of 10.61, a price-to-earnings-growth ratio of 1.41 and a beta of 0.67. The company has a quick ratio of 0.39, a current ratio of 0.97 and a debt-to-equity ratio of 0.08.

Sprouts Farmers Market (NASDAQ:SFM - Get Free Report) last released its quarterly earnings data on Wednesday, October 28th. The company reported $1.21 EPS for the quarter, missing the consensus estimate of $1.22 by ($0.01). Sprouts Farmers Market had a net margin of 5.45% and a return on equity of 33.83%. The business had revenue of $2.30 billion for the quarter, compared to the consensus estimate of $2.33 billion. During the same quarter last year, the business earned $1.22 EPS. Sprouts Farmers Market's revenue for the quarter was up 4.7% compared to the same quarter last year. As a group, research analysts anticipate that Sprouts Farmers Market, Inc. will post 4.95 EPS for the current fiscal year.

Insider Activity

In other Sprouts Farmers Market news, Director Joseph D. O'leary sold 2,597 shares of the stock in a transaction on Friday, August 14th. The stock was sold at an average price of $82.57, for a total value of $214,434.29. Following the sale, the director owned 14,710 shares in the company, valued at $1,214,604.70. This trade represents a 15.01% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, CEO Jack Sinclair sold 10,788 shares of Sprouts Farmers Market stock in a transaction that occurred on Tuesday, August 4th. The shares were sold at an average price of $86.80, for a total transaction of $936,398.40. Following the sale, the chief executive officer directly owned 269,980 shares of the company's stock, valued at $23,434,264. This represents a 3.84% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 46,041 shares of company stock worth $3,460,383 over the last quarter. 1.30% of the stock is currently owned by insiders.

Institutional Trading of Sprouts Farmers Market

Several institutional investors and hedge funds have recently made changes to their positions in the company. Bfsg LLC raised its stake in Sprouts Farmers Market by 414.3% in the third quarter. Bfsg LLC now owns 53,940 shares of the company's stock worth $3,579,000 after buying an additional 43,451 shares in the last quarter. Guardian Wealth Management Inc. boosted its position in Sprouts Farmers Market by 5.3% during the 3rd quarter. Guardian Wealth Management Inc. now owns 68,126 shares of the company's stock valued at $4,520,000 after acquiring an additional 3,422 shares in the last quarter. Chicago Partners Investment Group LLC increased its holdings in shares of Sprouts Farmers Market by 310.6% in the 3rd quarter. Chicago Partners Investment Group LLC now owns 47,681 shares of the company's stock valued at $3,159,000 after acquiring an additional 36,068 shares during the period. TT International Asset Management LTD increased its holdings in shares of Sprouts Farmers Market by 24.6% in the 3rd quarter. TT International Asset Management LTD now owns 17,319 shares of the company's stock valued at $1,149,000 after acquiring an additional 3,423 shares during the period. Finally, Lifetime Wealth Management P.C. raised its position in shares of Sprouts Farmers Market by 10.2% in the 3rd quarter. Lifetime Wealth Management P.C. now owns 70,145 shares of the company's stock worth $4,654,000 after acquiring an additional 6,500 shares in the last quarter.

About Sprouts Farmers Market

Sprouts Farmers Market, Inc NASDAQ: SFM is a specialty grocery retailer focused on fresh, natural and organic foods. Its stores offer a broad selection of fresh produce, meat and seafood, dairy products, bulk foods, vitamins and supplements, pantry staples, bakery items, deli products and prepared foods. The company emphasizes products that support healthy eating, including organic, plant-based and specialty-diet options.

Founded in 2002, Sprouts Farmers Market grew from its first store in Chandler, Arizona, into a national grocery chain.

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