Yes, it is just an overpriced grocery store, and yes, shoppers are getting ripped off. But so what? People are shopping there.
Consider how many people are up to their eyeballs in high-interest credit card debt. Consider how many stupid people purchase overpriced sport utility boxes. Consider how many people bought overvalued dot-com stocks, and continue to buy WFMI. Consider how many low-income half wits support a political party whose aim is to enrich the ultra-wealthy at the expense of working people. Whole Foods knows that people are stupid, and they made it the centerpiece of their business model. Whole Foods also knows there's a lot more market potential, because the supply of stupid people is virtually unlimited. That's smart.
Am I the only one here that thinks they had a good quarter? They hit their comps and their earnings estimate. They forecast the lower end of their range but it was their range. Yhe conference call was upbeat. They have now shed the momentum investors and those wanting in at a more reasonable price have the opportunity to do so. My posting a few days ago predicted this exaggerated response to what I consider good news.Any other grocery stores comping at 7%? The growth story is still good. Trust me I'm a doctor.
Trust me, too - I am an ex-stock analyst! You made a sterling call on the earnings reaction. Hope you indeed wrote some real calls. Smart move if so! Do you think the market may be reacting to store contribution income growth of just 9%? The solid control of G&A, interest expense, and pre-opening expense may not last forever. Also, where is rahodeb??
It's a good quarter for a grocery store. It's a disaster for a NAZ stock priced like a dotcom. The lower end of guidance is a whopping 15% earning gain for this year. Take 15 and multiply it by the 1.62 estimate and you get 27 and change. Let's add 10 points for an overpriced market and that gives you an idea of what this stock is worth.
I have no position, but I'm kicking myself for not buying the June puts I was eyeing earlier today. If WFMI sees the lights of 54 tomorrow like some folks are thinking (hoping) I'll be shorting with two fists.