Goldman Sachs has upgraded supermarket chain, Whole Foods Market, Inc.( WFM )to a "Buy" on Tuesday.
The firm reported that they have upgraded WFM from "Neutral" to a "Buy," and has raised its price target slightly from $105 to $106. This price target suggests a 12% increase over the stock's current price of $91.39.
An analyst from the firm commented, "as noted in our piece "Mapping out the winning ways of wellness" published concurrently with this upgrade, we believe that WFM is ideally positioned to benefit from the secular trends in healthy eating. Our upgrade is based on: (1) greater confidence in sustained +HSD comp growth and square footage growth within the rapidly growing natural and organic industry, (2) opportunity for EBIT margin expansion from improved sales productivity and fixed cost leverage, and (3) an attractive entry point at 30X NTM EPS, which has been a valuation floor."
Whole Foods Market shares were mostly flat during premarket trading Tuesday. The stock is up 31.37% YTD.
The Bottom Line
Shares of Whole Foods ( WFM ) have a .88% dividend yield, based on last night's closing stock price of $91.41. The stock has technical support in the $85 price area. If the shares can firm up, we see overhead resistance around the $95-$96 price levels.
Whole Foods Market, Inc.( WFM ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.
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