http://finance.yahoo.com/news/oppenheimer-weighs-sprouts-farmers-play-134533858.html
On March 19, “Bloomberg reported that Albertsons Companies Inc (NYSE: ABS) and Sprouts Farmers Market Inc (NASDAQ: SFM) held preliminary merger talks with proposed plans to take SFM private. The article noted the talks are at an early stage and may not lead to a deal,” Oppenheimer’s Rupesh Parikh said in a note.
The analyst maintains a Perform rating on Sprouts Farmers Market.
Sprouts ‘In Play’
Following a meeting with management on March 16, Parikh expressed a more positive stance on Sprouts Farmers Market, while mentioning that management was upbeat regarding the business.
However, if the company is “in play,” the analyst expects Kroger Co (NYSE: KR) and Whole Foods Market, Inc. (NASDAQ: WFM) to be interested.
“We suspect a high $20's-low $30's range would be a minimum to get a deal done, as industry valuations currently are depressed due in part to deflationary pressures. We expect WFM to be up in sympathy,” Parikh stated.
Whole Foods Versus Kroger
Using a mathematical model of a combination of Whole Foods and Sprouts Farmers Market, the analyst noted that a consolidation in the specialty grocery space might be warranted, although there still were major obstacles.
“We also do not believe SFM is in a rush to consummate a deal as a return to inflation and/or corporate tax reform could boost the company's valuation,” the analyst went on to say.
With regard to a bid from Kroger, Parikh believes the company “looks favorably upon the smaller format box as evidenced by the Lucky's partnership. Geographically, this would also remove a key market share grabbing competitor of KR boxes in a growing number of markets.”
On the other hand, Sprouts Farmers Market could be a compelling way for Whole Foods to achieve its goal of broadening its customer base.
“For us, the sticking point would be valuation especially if potentially bigger-pocketed rivals are in the mix,” the analyst added.
"Then there was a woman, a lion of a woman."
Recent SFM News
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/10/2024 10:22:14 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 05/09/2024 09:57:11 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/08/2024 11:01:33 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/08/2024 11:00:55 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/08/2024 11:00:40 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 05/08/2024 10:04:52 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 05/06/2024 10:25:57 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 05/06/2024 10:21:07 PM
- Sprouts Farmers Market, Inc. Reports First Quarter 2024 Results • Business Wire • 05/01/2024 08:02:00 PM
- Sprouts Farmers Market Releases 2023 Impact Report • Business Wire • 04/30/2024 10:02:00 AM
- Sprouts Farmers Market to Report First Quarter Earnings on May 1, 2024 • Business Wire • 04/03/2024 08:02:00 PM
- Sprouts Farmers Market Announces New NIL Deals • Business Wire • 03/19/2024 03:48:00 PM
- Sprouts Farmers Market Announces New NIL Deals • Business Wire • 03/19/2024 10:04:00 AM
- Sprouts Farmers Market to Present at the 36th Annual ROTH Conference • Business Wire • 03/07/2024 09:02:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/01/2024 11:02:39 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 02/28/2024 11:11:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 02/28/2024 11:10:49 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 02/28/2024 11:08:22 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 02/27/2024 10:45:38 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 02/26/2024 10:36:06 PM
- Sprouts Farmers Market, Inc. Reports Fourth Quarter and Full Year 2023 Results • Business Wire • 02/22/2024 09:05:00 PM
- Prairie Hill Acquires Rillito Crossing Marketplace for $27,525,000 • PR Newswire (US) • 02/20/2024 09:23:00 PM
- Sprouts Farmers Market to Report Fourth Quarter and Full Year 2023 Earnings on February 22, 2024 • Business Wire • 01/16/2024 09:02:00 PM
- Form 3 - Initial statement of beneficial ownership of securities • Edgar (US Regulatory) • 01/05/2024 11:09:57 PM
- Form 3 - Initial statement of beneficial ownership of securities • Edgar (US Regulatory) • 01/05/2024 11:03:47 PM
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