Why Whole Foods Market, Inc. (WFM) Will Continue to Thrive

Page 1 of 2

Over the past five years organic grocer, Whole Foods Market, Inc. (NASDAQ:WFM) grew trailing revenue and free cash flow 57% and 1600% respectively (see charts below). This translated into a market beating total return of 438%. You can expect this trend to continue due to the three reasons listed below.

WFM Revenue TTM data by YCharts

WFM Total Return Price data by YCharts

People want to eat healthier

Whole Foods Market, Inc. (NASDAQ:WFM)The extra health risk surrounding the obesity epidemic and the associated added health costs that go along with it encourage companies to incentivize healthier food consumption among their employees. In addition, consumers are slowly coming to grips with the fact that eating healthier leads to healthier and less costly lives.

Whole Foods Market, Inc. (NASDAQ:WFM) in its “conscious” capitalist fervor not only wants to capitalize on this trend but improve the health of the world in general. It also believes in keeping its own house in order first before preaching to the world. Employees get rewarded for lowering health care costs by encouraging a healthier lifestyle. Employee and stakeholder health ranks so high in importance with Whole Foods Market, Inc. (NASDAQ:WFM) that it decided to make that a core company value.

Beverage giant The Coca-Cola Company (NYSE:KO) experienced a 6% gain in its global still beverage volume versus just even in its more traditional sparkling beverage unit during its most recent quarter, serving as further evidence that people want to move away from the sugary and fattening soda drinks. Regulators seeing the negative effects want to regulate portion sizes of its drinks served in restaurants. The future prosperity of this company will also depend upon its ability to serve up healthier beverages such as bottled water and juice.

Better treatment of employees

Litigation from a Pennsylvania employee of a McDonald’s Corporation (NYSE:MCD) franchisee surrounding dubious debit card pay methods demonstrates that not everyone affiliated with McDonald’s holds the interest of lower level employees close to heart. It’s worth noting that these employees weren’t employed by McDonald’s Corporation (NYSE:MCD) directly; however, McDonald’s needs to know that happy stakeholders will take better care of its brand.

By contrast, Whole Foods Market, Inc. (NASDAQ:WFM) believes the bottom line gets tied to the economic interests of all stakeholders including employees. The company ranked #32 on Fortune’s list of “100 Best Companies to Work for in America” according to its 2012 annual report. Employees rank Whole Foods as 3.5 out of 5 translating into a “satisfied” rating versus 3.1 at McDonald’s Corporation (NYSE:MCD) or an “ok” rating at glassdoor.com.

Still in a growth phase

Whole Foods Market, Inc. (NASDAQ:WFM) still resides in a growth phase with market saturation nowhere in sight. As of the most recent quarter the company still only operated 349 stores with some states such as West Virginia having no Whole Foods’ at all. Whole Foods’ comparable store sales growth clocked in at an impressive 7% during the last quarter. In addition, its overall sales increased 13%.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

10 Best States To Practice Medicine

The 10 Best States to Have a Business

The 12 Most Expensive Apple (AAPL) Apps in the Market

The 10 Richest Billionaires in the World

10 Biggest Kickstarter Failures

The 10 Best Places to Work At

The Top 10 of Google Inc (GOOGL)’s Most Expensive Acquisitions

13 Best Cities to Visit in South America

10 Most Expensive Works of Art of All Time

The 10 Richest Banks in the World

The 10 Best-Paying Jobs in America (2014)

7 Most Expensive Foods in the World

The World’s Top 10 Earning Authors

Five Wicked and Very Expensive Items (and Other “Stuff”) Sold on eBay

10 Biggest Celebrity Bankruptcies

The Top 10 Highest Paid CEOs in 2014

The 10 Most Expensive Real Estate Cities in America

10 Most Expensive States To Live In America

The 10 Best Airlines in the World

The 10 Best-Selling Cars in 2014

The 10 Best Industries to Invest In

The 10 Most Expensive States to Own a Car In

Top 10 Business Schools in US: 2014 Rankings

Top 20 Female Billionaires in 2014

6 Movies That You Should Watch to Better Understand The Cold War

Top 15 Best Paying Jobs for Women in 2014

Top 6 Things Rich People Do Differently Every Day

5 Retirement Mistakes To Avoid (and Einstein’s Famous Quote)

11 Smartest People in the World

6 Films About the Financial World You Need To Watch (While “The Wolf” is Not Around)

Warren Buffett and Billionaires Are Crazy About These 7 Stocks

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top 6 Tax Scams and How to Protect Yourself

Top Businesses to Invest In

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!