A classic case of misdirection: Whole Foods (NASDAQ: WFMI) reported weak earnings, but raised its dividend, sending its shares up as much as 7% after hours.
Whole Foods earned $33.9 million, or 24 cents per share, in its fourth quarter, down from $39.8 million, or 28 cents per share, a year earlier. The company blamed costs of merging with Wild Oats for much of the drop. Revenue rose 35% to $1.74 billion, in large part because of the merger.
But same-store sales were up an impressive 8.2%.
All in all, the market might have been dissatisfied with the numbers and pushed down the stock, especially in an environment where weak numbers can be especially punishing to a stock's price. But Whole Foods was clever and got around that. According to TheStreet.com, WFMI "increased its dividend 11% to 20 cents per share," making the stock more attractive to investors who may have concerns about earnings.
Douglas A. McIntyre is an editor at 247wallst.com.
Once again, OPEC has killed the goose that lays the golden egg
Closing Bell: Markets bounce after yesterday's sell-off; BA, F, GE, DOW all up, GS down 
Where have all the consumers gone?
Reader Comments (Page 1 of 1)
11-21-2007 @ 6:45AM
nancyhere said...
making the stock more attractive to investors who may have concerns about earnings.
11-21-2007 @ 6:55AM
nancyhere said...
Yes, we should make the stock more attractive to investors who may have concerns about earnings. Especilly for these poor blacks, i have met a lot of complaining blogs on bigblackconnect.com. Some members are comlaining about the price.
11-21-2007 @ 6:57AM
brian said...
That is a bit harsh and I have to question your judgement Same store sales were up 8.2%! You are saying the stock would have tanked but they pulled a fast one and raised the dividend? Obviously there were huge costs in the merger with WOats. You are in left field on this one.