RBC Capital Cuts Price Target on Sprouts Farmers Market (SFM) to $29
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RBC Capital maintained an Outperform rating on Sprouts Farmers Market (NASDAQ: SFM), and cut the price target to $29.00 (from $31.00), following the company's 3Q earnings report. Sprouts reported comparable store sales growth of +1.3%, ahead of consensus estimate of +0.3%. Revenues of $1.04bn also beat consensus' $1.01bn. EPS of $0.16 slightly missed consensus of $0.17.
Analyst William Kirk commented, "By responding to increased competitor promo (highlighted Sept 8th), gross margins have come under pressure. We are not sure why this is surprising. We found the comparable sales response to elevated price investment encouraging. We believe the elasticity on the price investment was strong, and likely ROIC favorable to the alternative of not matching competitor promo. Reiterate Outperform on outsized leverage to cycle improving."
Shares of Sprouts Farmers Market closed at $20.03 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst EPS View, Analyst PT Change
Related EntitiesRBC Capital, Earnings
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