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SPROUTS FARMERS MARKET INC (SFM) Stock Fundamental Analysis

NASDAQ:SFM - Nasdaq - US85208M1027 - Common Stock - Currency: USD

143.32  -26.48 (-15.59%)

After market: 143.95 +0.63 (+0.44%)

Fundamental Rating

6

SFM gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 40 industry peers in the Consumer Staples Distribution & Retail industry. SFM scores excellent points on both the profitability and health parts. This is a solid base for a good stock. SFM does not seem to be growing, but still is valued expensively.


Dividend Valuation Growth Profitability Health

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9

1. Profitability

1.1 Basic Checks

In the past year SFM was profitable.
In the past year SFM had a positive cash flow from operations.
Of the past 5 years SFM 4 years were profitable.
Of the past 5 years SFM 4 years had a positive operating cash flow.
SFM Yearly Net Income VS EBIT VS OCF VS FCFSFM Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 100M 200M 300M 400M

1.2 Ratios

With an excellent Return On Assets value of 9.79%, SFM belongs to the best of the industry, outperforming 94.87% of the companies in the same industry.
The Return On Equity of SFM (26.13%) is better than 84.62% of its industry peers.
SFM has a better Return On Invested Capital (12.18%) than 82.05% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for SFM is above the industry average of 8.35%.
The last Return On Invested Capital (12.18%) for SFM is above the 3 year average (10.65%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 9.79%
ROE 26.13%
ROIC 12.18%
ROA(3y)8.21%
ROA(5y)8.08%
ROE(3y)24.31%
ROE(5y)26.25%
ROIC(3y)10.65%
ROIC(5y)10.39%
SFM Yearly ROA, ROE, ROICSFM Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 10 20 30

1.3 Margins

Looking at the Profit Margin, with a value of 4.73%, SFM belongs to the top of the industry, outperforming 94.87% of the companies in the same industry.
SFM's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 6.49%, SFM belongs to the best of the industry, outperforming 94.87% of the companies in the same industry.
SFM's Operating Margin has improved in the last couple of years.
SFM's Gross Margin of 37.75% is amongst the best of the industry. SFM outperforms 87.18% of its industry peers.
SFM's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 6.49%
PM (TTM) 4.73%
GM 37.75%
OM growth 3Y-1.98%
OM growth 5Y4.77%
PM growth 3Y-5.21%
PM growth 5Y4.46%
GM growth 3Y0.09%
GM growth 5Y1.91%
SFM Yearly Profit, Operating, Gross MarginsSFM Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 10 20 30

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7

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), SFM is creating some value.
There is no outstanding debt for SFM. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
SFM Yearly Shares OutstandingSFM Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 50M 100M 150M
SFM Yearly Total Debt VS Total AssetsSFM Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 1B 2B 3B

2.2 Solvency

SFM has an Altman-Z score of 7.30. This indicates that SFM is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 7.30, SFM belongs to the top of the industry, outperforming 87.18% of the companies in the same industry.
The Debt to FCF ratio of SFM is 0.03, which is an excellent value as it means it would take SFM, only 0.03 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of SFM (0.03) is better than 94.87% of its industry peers.
SFM has a Debt/Equity ratio of 0.01. This is a healthy value indicating a solid balance between debt and equity.
With an excellent Debt to Equity ratio value of 0.01, SFM belongs to the best of the industry, outperforming 89.74% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.01
Debt/FCF 0.03
Altman-Z 7.3
ROIC/WACC1.34
WACC9.08%
SFM Yearly LT Debt VS Equity VS FCFSFM Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M 1B

2.3 Liquidity

A Current Ratio of 1.13 indicates that SFM should not have too much problems paying its short term obligations.
With a Current ratio value of 1.13, SFM perfoms like the industry average, outperforming 46.15% of the companies in the same industry.
A Quick Ratio of 0.59 indicates that SFM may have some problems paying its short term obligations.
SFM has a Quick ratio of 0.59. This is comparable to the rest of the industry: SFM outperforms 51.28% of its industry peers.
The current and quick ratio evaluation for SFM is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
Industry RankSector Rank
Current Ratio 1.13
Quick Ratio 0.59
SFM Yearly Current Assets VS Current LiabilitesSFM Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M

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3

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 32.86% over the past year.
The Earnings Per Share has been growing by 24.64% on average over the past years. This is a very strong growth
EPS 1Y (TTM)32.86%
EPS 3Y21.43%
EPS 5Y24.64%
EPS Q2Q%61.22%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%17.53%

3.2 Future

The Earnings Per Share is expected to grow by 1.09% on average over the next years.
SFM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.90% yearly.
EPS Next Y14.49%
EPS Next 2Y13.63%
EPS Next 3Y13.69%
EPS Next 5Y1.09%
Revenue Next Year10.42%
Revenue Next 2Y10.64%
Revenue Next 3Y10.31%
Revenue Next 5Y5.9%

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
SFM Yearly Revenue VS EstimatesSFM Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2B 4B 6B 8B 10B
SFM Yearly EPS VS EstimatesSFM Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2 4 6

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2

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 38.12, the valuation of SFM can be described as expensive.
66.67% of the companies in the same industry are cheaper than SFM, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 29.63, SFM is valued a bit more expensive.
With a Price/Forward Earnings ratio of 33.29, SFM can be considered very expensive at the moment.
SFM's Price/Forward Earnings is on the same level as the industry average.
SFM's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 22.68.
Industry RankSector Rank
PE 38.12
Fwd PE 33.29
SFM Price Earnings VS Forward Price EarningsSFM Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SFM indicates a slightly more expensive valuation: SFM is more expensive than 66.67% of the companies listed in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as SFM.
Industry RankSector Rank
P/FCF 40.43
EV/EBITDA 26.91
SFM Per share dataSFM EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 20 40 60

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates SFM does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of SFM may justify a higher PE ratio.
SFM's earnings are expected to grow with 13.69% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.63
PEG (5Y)1.55
EPS Next 2Y13.63%
EPS Next 3Y13.69%

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0

5. Dividend

5.1 Amount

SFM does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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SPROUTS FARMERS MARKET INC

NASDAQ:SFM (2/21/2025, 8:00:01 PM)

After market: 143.95 +0.63 (+0.44%)

143.32

-26.48 (-15.59%)

Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupConsumer Staples Distribution & Retail
GICS IndustryConsumer Staples Distribution & Retail
Earnings (Last)02-20 2025-02-20/amc
Earnings (Next)04-29 2025-04-29/amc
Inst Owners107.91%
Inst Owner Change-3.05%
Ins Owners0.43%
Ins Owner Change-5.94%
Market Cap14.33B
Analysts68
Price Target148.09 (3.33%)
Short Float %6.95%
Short Ratio5.47
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)17.86%
Min EPS beat(2)16.84%
Max EPS beat(2)18.87%
EPS beat(4)4
Avg EPS beat(4)13.4%
Min EPS beat(4)7.48%
Max EPS beat(4)18.87%
EPS beat(8)8
Avg EPS beat(8)11.84%
EPS beat(12)12
Avg EPS beat(12)11.55%
EPS beat(16)16
Avg EPS beat(16)15.98%
Revenue beat(2)2
Avg Revenue beat(2)2.38%
Min Revenue beat(2)2.08%
Max Revenue beat(2)2.68%
Revenue beat(4)3
Avg Revenue beat(4)1.26%
Min Revenue beat(4)-0.67%
Max Revenue beat(4)2.68%
Revenue beat(8)4
Avg Revenue beat(8)0.64%
Revenue beat(12)5
Avg Revenue beat(12)0.35%
Revenue beat(16)6
Avg Revenue beat(16)-0.63%
PT rev (1m)0%
PT rev (3m)40.55%
EPS NQ rev (1m)0.65%
EPS NQ rev (3m)0.45%
EPS NY rev (1m)0.11%
EPS NY rev (3m)0.07%
Revenue NQ rev (1m)0.1%
Revenue NQ rev (3m)0.1%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)0%
Valuation
Industry RankSector Rank
PE 38.12
Fwd PE 33.29
P/S 1.93
P/FCF 40.43
P/OCF 24.86
P/B 10.67
P/tB 19.01
EV/EBITDA 26.91
EPS(TTM)3.76
EY2.62%
EPS(NY)4.3
Fwd EY3%
FCF(TTM)3.54
FCFY2.47%
OCF(TTM)5.76
OCFY4.02%
SpS74.22
BVpS13.44
TBVpS7.54
PEG (NY)2.63
PEG (5Y)1.55
Profitability
Industry RankSector Rank
ROA 9.79%
ROE 26.13%
ROCE 16.23%
ROIC 12.18%
ROICexc 13.59%
ROICexgc 17.47%
OM 6.49%
PM (TTM) 4.73%
GM 37.75%
FCFM 4.78%
ROA(3y)8.21%
ROA(5y)8.08%
ROE(3y)24.31%
ROE(5y)26.25%
ROIC(3y)10.65%
ROIC(5y)10.39%
ROICexc(3y)11.79%
ROICexc(5y)11.34%
ROICexgc(3y)15.59%
ROICexgc(5y)15.08%
ROCE(3y)14.19%
ROCE(5y)13.85%
ROICexcg growth 3Y-7.4%
ROICexcg growth 5Y-7.76%
ROICexc growth 3Y-6.16%
ROICexc growth 5Y-2.6%
OM growth 3Y-1.98%
OM growth 5Y4.77%
PM growth 3Y-5.21%
PM growth 5Y4.46%
GM growth 3Y0.09%
GM growth 5Y1.91%
F-Score8
Asset Turnover2.07
Health
Industry RankSector Rank
Debt/Equity 0.01
Debt/FCF 0.03
Debt/EBITDA 0.01
Cap/Depr 160.88%
Cap/Sales 2.99%
Interest Coverage 72.2
Cash Conversion 93%
Profit Quality 100.96%
Current Ratio 1.13
Quick Ratio 0.59
Altman-Z 7.3
F-Score8
WACC9.08%
ROIC/WACC1.34
Cap/Depr(3y)114.22%
Cap/Depr(5y)117.66%
Cap/Sales(3y)2.3%
Cap/Sales(5y)2.41%
Profit Quality(3y)98.25%
Profit Quality(5y)107.82%
High Growth Momentum
Growth
EPS 1Y (TTM)32.86%
EPS 3Y21.43%
EPS 5Y24.64%
EPS Q2Q%61.22%
EPS Next Y14.49%
EPS Next 2Y13.63%
EPS Next 3Y13.69%
EPS Next 5Y1.09%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%17.53%
Revenue Next Year10.42%
Revenue Next 2Y10.64%
Revenue Next 3Y10.31%
Revenue Next 5Y5.9%
EBIT growth 1Y25.28%
EBIT growth 3Y-0.15%
EBIT growth 5Y10.63%
EBIT Next Year65.3%
EBIT Next 3Y27%
EBIT Next 5Y21.36%
FCF growth 1Y35.38%
FCF growth 3Y-13.62%
FCF growth 5Y15.37%
OCF growth 1Y53.75%
OCF growth 3Y-1.99%
OCF growth 5Y9.58%