Why Sprouts Farmers Market Is Rocketing Higher Today

2026-04-30 14:38:43 ET

Shares of attribute-focused, specialty grocery chain Sprouts Farmers Market (NASDAQ: SFM) are up 17% as of noon ET on Thursday following the company's excellent first-quarter earnings. While sales only inched 4% higher -- and earnings per share actually dipped 6% -- these figures outpaced Wall Street's low expectations. More importantly, management guided for full-year revenue growth of 5.5% and EPS of roughly $5.40, leaving the stock trading at just 15 times forward earnings, even after today's rise. With Sprouts' stock price already cut in half over the last year, the bar had been lowered a bit for the better-for-you grocer, and its resilience amid a challenging consumer-spending environment helped spark today's pop.

After growing sales by double-digits for six straight quarters over the last two years -- before slowing to 7% and 4% in its last two earnings reports -- Sprouts is doing reasonably well lapping these tough comparables. While Sprouts only opened six new stores in Q1, raising its total count to 483 in 25 states, it plans to open at least 34 more over the next three quarters -- all easily funded from cash on hand and cash from operations. One of these six new locations was Sprouts' first in New York, which could offer huge potential if the company can "stick its landing" as it expands into the Northeast.

Image source: Getty Images.

Continue reading