Whole Foods Market, Inc. Earnings Cheat Sheet: Beats the Street on Profit Rise

S&P 500 (NYSE:SPY) component Whole Foods Market, Inc. (NASDAQ:WFMI) reported net income above Wall Street’s expectations for the third quarter. Whole Foods Market, Inc. owns and operates the chain of natural and organic foods supermarkets. Its products include seafood, grocery, meat and poultry, bakery and prepared foods.

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Whole Foods Market Earnings Cheat Sheet for the Third Quarter

Results: Net income for the grocery store rose to $88.5 million (50 cents per share) vs. $65.7 million (38 cents per share) in the same quarter a year earlier. This marks a rise of 34.6% from the year earlier quarter.

Revenue: Rose 10.9% to $2.4 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: WFMI beat the mean analyst estimate of 39 cents per share. It fell short of the average revenue estimate of $9.9 billion.

Quoting Management: “We are continuing to gain market share at a faster rate than most public food retailers as reflected in our 8.5% comparable store sales growth year to date. We attribute much of our success to our value efforts, which have improved our price image, and to continuing to raise the bar in areas that matter to our customers, particularly quality standards and health and wellness,” said Walter Robb, co-chief executive officer of Whole Foods Market. “We are producing consistently strong top- and bottom-line results and are very excited to be accelerating our new store openings once again. Through continued innovation and ongoing discipline around expenses and capital allocation, we expect to deliver higher levels of both operating performance and returns on invested capital over time.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 13.2%, with the biggest boost coming in the third quarter of the last fiscal year when revenue rose 15.2% from the year earlier quarter.

The company has now seen net income rise in three straight quarters. In the second quarter, net income rose 33.3% and in the first quarter, the figure rose 60.9%.

The company has now topped analyst estimates for the last four quarters. It beat the mark by one cent in the second quarter, by 4 cents in the first quarter, and by 4 cents in the fourth quarter of the last fiscal year.

Gross margins grew 0.2 percentage point to 35.4%. The growth seemed to be driven by increased revenue, as the figure rose 10.9% from the year earlier quarter while costs rose 10.6%.

Competitors to Watch: Safeway Inc. (NYSE:SWY), The Kroger Co. (NYSE:KR), SUPERVALU INC. (NYSE:SVU), The Fresh Market Inc (NASDAQ:TFM), Winn-Dixie Stores, Inc. (NASDAQ:WINN), Ingles Markets, Inc. (NASDAQ:IMKTA), Weis Markets, Inc. (NYSE:WMK), Ruddick Corporation (NYSE:RDK), Wal-Mart (NYSE:WMT), Target (NYSE:TGT), Arden Group, Inc. (NASDAQ:ARDNA).

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(Source: Xignite Financials)

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