Whole Foods Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Whole Foods Market, Inc. (NASDAQ:WFM) will unveil its latest earnings tomorrow, Wednesday, July 25, 2012. Whole Foods Market owns and operates a chain of natural and organic foods supermarkets. Its products include seafood, grocery, meat and poultry, bakery and prepared foods.

Whole Foods Market, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 61 cents per share, a rise of 22% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved up from 58 cents. Between one and three months ago, the average estimate moved up. It has risen from 60 cents during the last month. Analysts are projecting profit to rise by 28% versus last year to $2.47.

Past Earnings Performance: Last quarter, the company beat estimates by 5 cents, coming in at net income of 64 cents a share versus the estimate of profit of 59 cents a share. It marked the fourth straight quarter of beating estimates.

Investing Insights: Is TV the Next Bullish Catalyst for Apple’s Stock?

A Look Back: In the second quarter, profit rose 30.8% to $117.7 million (64 cents a share) from $89.9 million (51 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 13.6% to $2.67 billion from $2.35 billion.

Wall St. Revenue Expectations: On average, analysts predict $2.73 billion in revenue this quarter, a rise of 13.8% from the year-ago quarter. Analysts are forecasting total revenue of $11.68 billion for the year, a rise of 15.5% from last year’s revenue of $10.11 billion.

Stock Price Performance: Between April 24, 2012 and July 23, 2012, the stock price rose $0.14 (.17%), from $83.67 to $83.81. The stock price saw one of its best stretches over the last year between September 9, 2011 and September 19, 2011, when shares rose for seven straight days, increasing 11.8% (+$7.62) over that span. It saw one of its worst periods between July 28, 2011 and August 8, 2011 when shares fell for eight straight days, dropping 19.3% (-$12.93) over that span.

Key Stats:

The company enters this earnings announcement with substantial revenue momentum. The company has averaged year-over-year revenue growth of 12.4% over the last four quarters.

After experiencing income increases the last three quarters, the company is hoping to keep the good news coming with this earnings announcement. Net income rose 31.3% in the fourth quarter of the last fiscal year and 33.4% in the first quarter before increasing again in the second quarter.

Analyst Ratings: With 14 analysts rating the stock a buy, none rating it a sell and nine rating the stock a hold, there are indications of a bullish stance by analysts.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.0 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company improved this liquidity measure from 1.87 in the first quarter to the last quarter driven in part by an increase in current assets. Current assets increased 13.3% to $1.9 billion while liabilities rose by 6.2% to $952.2 million.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute — click here and get our CHEAT SHEET stock picks now.

(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

Don’t Miss These Additional Hot Stories:

Will New Apple Products PUMP UP Shares?

Are Share Buybacks a Good Idea?

Is Now The Time to Buy This Depressed Dow Stock?