Sprouts Farmers (SFM) Falls More Steeply Than Broader Market: What Investors Need to Know

In the latest trading session, Sprouts Farmers (SFM) closed at $158.88, marking a -3.23% move from the previous day. This change lagged the S&P 500's daily loss of 0.07%. Elsewhere, the Dow saw a downswing of 0.37%, while the tech-heavy Nasdaq appreciated by 0.03%.

The natural and organic food retailer's shares have seen a decrease of 0.94% over the last month, not keeping up with the Retail-Wholesale sector's gain of 1.87% and the S&P 500's gain of 3.94%.

The investment community will be closely monitoring the performance of Sprouts Farmers in its forthcoming earnings report. The company is scheduled to release its earnings on July 30, 2025. The company is forecasted to report an EPS of $1.22, showcasing a 29.79% upward movement from the corresponding quarter of the prior year. In the meantime, our current consensus estimate forecasts the revenue to be $2.16 billion, indicating a 14.34% growth compared to the corresponding quarter of the prior year.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $5.08 per share and a revenue of $8.77 billion, signifying shifts of +35.47% and +13.6%, respectively, from the last year.

Investors might also notice recent changes to analyst estimates for Sprouts Farmers. These recent revisions tend to reflect the evolving nature of short-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.04% higher. Right now, Sprouts Farmers possesses a Zacks Rank of #2 (Buy).

From a valuation perspective, Sprouts Farmers is currently exchanging hands at a Forward P/E ratio of 32.32. This indicates a premium in contrast to its industry's Forward P/E of 17.48.

It's also important to note that SFM currently trades at a PEG ratio of 2.05. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As of the close of trade yesterday, the Food - Natural Foods Products industry held an average PEG ratio of 1.65.

The Food - Natural Foods Products industry is part of the Retail-Wholesale sector. This industry, currently bearing a Zacks Industry Rank of 181, finds itself in the bottom 27% echelons of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.

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Sprouts Farmers Market, Inc. (SFM) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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