7/23 is correct, then 8/20, then 9/17, and hopefully they will make an announcement in time for the next 3 or 4 months beyond Sept.. GLTU.
When companies are overly rich in cash a buy back might make sense, and many of these companies pay dividends as well. Just to buy back shares to instill some confidence hopefully raising the pps I believe is the wrong way to go. JMHO. I remain long term and believe in letting the future bottom line play out with a good ER. That will take care of the pps.
Fast your correct about ljle, good for you. He likes to hear himself/herself talk, usually about competition ad nauseam. Since he doesn't own any SFM I wonder why he's here? So you answered that.
Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in SFM over the next 72 hours. (More...)I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
• Sprouts Farmers Market trades towards its all-time low.
• The organic and fresh food sector remains highly competitive, yet Sprouts continues to produce exceptional growth.
• The stock isn't cheap on normal metrics, but the value will build if it continues trading at these levels for long.
After a slight disappointment in Q1, Sprouts Farmers Market (NASDAQ:SFM) can't seem to catch any momentum. The once loved organic and fresh grocer is no longer loved. Going on two years of being public, the fresh produce focused grocer hasn't provided any positive returns for shareholders.
While Sprouts has spent the majority of its public life trading at levels mostly above the current $28 level, it consistently seems to return to this level. Considering the grocer continues growing at a fast clip, the reasonable expectation is that value grows each and every day it stays at these depressed levels.
Q2 And Beyond
The key to most investments is separating the company from the investment vehicle. Find a good company and the stock will eventually work itself out even if one overpaid for it originally.
In the case of Sprouts, it appears a good company that had an extremely overvalued stock from the beginning until now. The organic and fresh grocery sector hit extreme excitement right around when Sprouts went public at the end of 2013. The Fresh Market (NASDAQ:TFM) had preceded it into the public markets and saw the stock max out around that same time.
Sprouts the company remains on a fast-growth track. Analysts forecast Q2 revenue surging 21% and over 21% for the year. The company doesn't appear to have any problems other than maybe some overly high expectation issues.
The stock is where some red flags still arise. Despite the drop from a peak of $50 in 2013 and around $38 to start this year, Sprouts still trades at around 27x 2016 earnings. If the company can grow EPS at the 20% clip, the stock will definitely not stick around this level for long. It just doesn't offer the bargain prices one would expect after a weak trading year.
As highlighted in Sprouts Farmers Market Disappointment Leads To Opportunity, the grocer had a disappointing Q1 due to some external reasons. Keep in mind that the disappointment centered around 4.8% comp sales growth that normally would appear strong. The number was the lowest in the last couple of years, but nearly equivalent to the two-year stacked level produced in 2010. Sure that was caused in part by the financial crisis, but it is a good reminder that good companies will still see weak growth periods.
Another interesting note, the company went public in 2013 after producing 2012 revenue of roughly $2.0 billion. In 2014, revenue was nearly $3.0 billion, or 50% growth in those two years. Analysts forecast revenue reaching $3.6 billion this year for 80% growth in three years.
Sure higher competition remains a major concern in the sector, but the grocery sector was already highly competitive before Sprouts even joined the market. My local store already faced tough competition from both a Wal-Mart (NYSE:WMT) and Target (NYSE:T) with full groceries along with a popular local grocery chain. It hasn't stopped the Sprouts store from having packed parking lots.
The interesting case study of the Phoenix location is a prime example of how Sprouts thrives even with competition. The low cost and high quality produce sets it apart from the competition.
In my case, visits to the grocery section of Target and Wal-Mart were replaced by trips to Sprouts. The feared competitive scenarios with the other stores aren't being born out.
As predicted in the last article, the Q1 miss combined with competitive fears and the timing of the insider sells were likely to send Sprouts Farmers Market trading towards the all-time low near $26. The stock isn't cheap by most metrics, but it is no longer expensive. Investors looking to buy should start looking to pull the trigger soon with a mental stop loss if the stock were to dip below $26.
Additional disclosure: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research and reach your own conclusion or consult a financial advisor. Investing includes risks, including loss of principal.
PSEC data by YCharts
One final stock with some large insider buying is Prospect Capital (PSEC - Get Report), which is a business development company. Insiders are buying this stock into notable weakness, since shares have dropped by 9.2% over the last three months.
Prospect Capital has a market cap of $2.7 billion and an enterprise value of $5.7 billion. This stock trades at a fair valuation, with a trailing price-to-earnings of 8.3 and a forward price-to-earnings of 7.4. Its estimated growth rate for the next quarter is -7.1%, and for this year it's pegged at -12.6%. This is not a cash-rich company, since the total cash position on its balance sheet is $63.62 million and its total debt is $2.98 billion. This stock currently sports a dividend yield of 12.8%.
The CEO just bought 140,000 shares, or about $1.04 million worth of stock, at $7.46 per share. From a technical perspective, Prospect Capital is currently trending below both its 50-day and 200-day moving averages, which is bearish. This stock has been uptrending strong over the last few weeks, with shares moving higher from its low of $7.18 to its recent high of $7.83 a share. During that uptrend, shares of Prospect Capital has been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed this stock within range of triggering a near-term breakout trade.
If you're bullish on Prospect Capital, then I would look for long-biased trades as long as this stock is trending above some near-term support levels at $7.60 to $7.50 a share and then once it breaks out above some near-term overhead resistance levels at $7.83 to its 50-day moving average of $7.96 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average volume of 2.77 million shares. If that breakout begins soon, then this stock will set up to re-test or possibly take out its next major overhead resistance level
You have to do your own DOD. This is not the place to take advice. Some good people here, also some bad. No one can advice you on this board without really knowing anything about you. My best advice is to talk to someone at Vanguard and review what they offer in a diversified fund, could be stocks, could be bonds, could be a combination etc, I believe they are one of the best and offer many products and charge little. Just one word of advice is to be diversified, don't put all your eggs in one basket.. GLTU.
I do believe once OHI declares their .54 cent dividend in July (unless they raise it to .55 cents) we will see the PPS go back into the 40's. To many were confused last time thinking the divvy was cut to .18, or to .36 cents. GLTA
So your no longer a holder, so why here? We don't need you to educate or mostly bash on this board. Take your story somewhere else loser. Stop acting like a short, or like psac, unless your him with another created alias?
So why are you here if you sold out and say your not a short? What's your purpose, your agenda? Are you trying to educate the longs? They would rather you move on to other boards where you might own some stock. No reason for you to be here bashing.
And don't forget dela, Trump the ego prize winner also said gas will be 6 bucks and higher a gallon a year or two ago. They didn't ask him that on Joes this morning. They just let him brag on.
Look in the mirror and your on report.
You've been a short all along, reading your posts initially you disguised yourself well, but your recent rants shows your true agenda. A wolf in sheep's clothing now coming out full blast. Stop saying you love this company, you love WMF like Cramer since you keep bringing them up, like no one else can beat them in the organic field. SFM has already proven they can. Stay tuned.
All you ever point out with your rants is your agenda as a short. It's all BS. Take your clown show on the road, and while in the country sell it to a toad, for you're the ultimate deceiver, and anyone who listens to your BS as the receiver isn't smart enough to do his own due diligence, so like you he's being ridiculous. So ride the waves on your boat, or better then that no boat with your BS you'll float. Get lost Mr. know it all, spend your time at the mall trying to convince others, be they strangers or brothers, we don't buy your BS.