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Sprouts Farmers (SFM) Stock Drops Despite Market Gains: Important Facts to Note

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The most recent trading session ended with Sprouts Farmers (SFM - Free Report) standing at $115.32, reflecting a -0.69% shift from the previouse trading day's closing. This change lagged the S&P 500's daily gain of 0.77%. Meanwhile, the Dow gained 0.47%, and the Nasdaq, a tech-heavy index, added 0.87%.

Prior to today's trading, shares of the natural and organic food retailer had gained 13.73% over the past month. This has outpaced the Retail-Wholesale sector's gain of 5.56% and the S&P 500's gain of 4.87% in that time.

Analysts and investors alike will be keeping a close eye on the performance of Sprouts Farmers in its upcoming earnings disclosure. The company's earnings report is set to go public on October 30, 2024. The company's upcoming EPS is projected at $0.75, signifying a 15.38% increase compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $1.87 billion, indicating an 8.9% upward movement from the same quarter last year.

For the full year, the Zacks Consensus Estimates project earnings of $3.37 per share and a revenue of $7.5 billion, demonstrating changes of +18.66% and +9.63%, respectively, from the preceding year.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for Sprouts Farmers. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. As of now, Sprouts Farmers holds a Zacks Rank of #3 (Hold).

With respect to valuation, Sprouts Farmers is currently being traded at a Forward P/E ratio of 34.45. This represents a premium compared to its industry's average Forward P/E of 15.38.

It is also worth noting that SFM currently has a PEG ratio of 3.3. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. Food - Natural Foods Products stocks are, on average, holding a PEG ratio of 2.1 based on yesterday's closing prices.

The Food - Natural Foods Products industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 211, which puts it in the bottom 17% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the 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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