Whole Foods Market, Inc. (NASDAQ: WFMI) reported its earnings at $0.19 non-GAAP EPS and $1.86 billion in revenues for the second quarter, and Thomson Reuters had consensus estimates of $0.18 EPS and $1.87 billion. The earnings included non-cash asset impairment charges of approximately $13 million, or $0.05 per share. There are several things that are good about the quarter and there are a few issues. Same store sales were -4.1%, yet it showed operating cash flow of $173 million and generated $98 million of free cash flow. The company also maintained certain aspects of guidance, at least sort of. It sees opening two additional stores (including one relocation) in the third quarter and sees opening three stores in the fourth quarter, and is still waiting on the divestment approval from the FTC.
Assuming everything remains static, the company now sees just under $8.0 billion in Fiscal September-2010, yet Thomson Reuters has estimates at $8.04 billion. That seems a tad light on the surface. That is actually under an $8.3 billion it first projected in February.
Shares closed down 9% at $20.00 during the normal trading day, yet shares are actually up close to $22.00 in the after-hours session. The 52-week trading range is $7.04 to $34.08, and this was a $50 stock just about 20 months ago. What is almost very surprising here is that there is not additional profit taking even after the sell-off of 9% to $20.00 today. This has risen 200% from the lows and is up more than 100% from when I previously noted it with 5 retail stocks which could double by the end of the recession.
Shares are up at $21.51 after the close (as of 4:57 PM EST), yet had traded up almost at $22.00. If there was ever a chance to see some profit taking, this might have seemed like one of those occasions. It seems that is what can happen when you have over 7 days of average trading volume listed in the short interest.
Jon Ogg is a partner in 24/7 Wall Street and he does not own stock in the companies he writes about.
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Reader Comments (Page 1 of 1)
5-13-2009 @ 7:31PM
Jon said...
Go Wholefoods !