Will Stiff Competition Drag Whole Foods (WFM) Q3 Earnings? - Analyst Blog

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Whole Foods Market, Inc. ( WFM ), one of the leading natural and organic foods supermarkets, is slated to report its third-quarter fiscal 2014 results on Jul 30. In the last quarter, it delivered a negative surprise of 7.32%. Let's see how things are shaping up for this announcement.

Factors Influencing This Quarter

Whole Foods has been grappling with increasing competition and aggressive pricing that are weighing on the company's performance as more and more companies are entering as well as expanding their presence in the Organic & Natural food business.

Earnings Whispers?

Our proven model does not conclusively show that Whole Foods is likely to beat earnings estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. This is not the case here, as you will see below.

Zacks ESP: Earnings ESP for Whole Foods is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 39 cents.

Zacks Rank: Whole Foods has a Zacks Rank #4 (Sell) which lowers the predictive power of ESP. We caution against stocks with a Zacks Ranks #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks that Warrant a Look

Here are some companies you may want to consider as our model shows that these have the right combination of elements:

Treehouse Foods, Inc. ( THS ) has an Earnings ESP of +1.21% and a Zacks Rank #1 (Strong Buy).

Big Lots Inc. ( BIG ) has an Earnings ESP of +3.33% and a Zacks Rank #2 (Buy).

Wal-Mart Stores Inc. ( WMT ) has an Earnings ESP of +2.48% and a Zacks Rank #3 (Hold).


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WHOLE FOODS MKT (WFM): Free Stock Analysis Report

WAL-MART STORES (WMT): Free Stock Analysis Report

BIG LOTS INC (BIG): Free Stock Analysis Report

TREEHOUSE FOODS (THS): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Earnings , Stocks

Referenced Stocks: WFM , WMT , BIG , THS

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