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

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

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!