UPDATE: Goldman Sachs Downgrades Whole Foods Market on Lower Estimates, Elevated Valuation

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In a report published Friday, Goldman Sachs analyst Stephen Grambling downgraded the rating on
Whole Foods MarketWFM
from Buy to Neutral, and lowered the price target from $66.00 to $57.00. In the report, Goldman Sachs noted, “We are downgrading WFM to Neutral from Buy following F4Q results. While we still view WFM as a secular winner with continued opportunity for store growth and margin expansion, we are lowering our comp estimate to reflect the softer top-line trajectory relative to broader industry trends. Furthermore, with shares still trading at 34X our downwardly revised but above guidance NTM EPS estimate, we believe a Neutral rating is warranted and would look for a better entry point, all else being equal. Since adding WFM to the Buy List on 11/20/12, the shares are +23% vs. the S&P 500 +26%. Shares traded down 11% November 7 following 4Q results.” Whole Foods Market closed on Thursday at $57.26.
Posted In: Analyst ColorDowngradesAnalyst RatingsGoldman SachsStephen Grambling
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