Average Brokerage Recommendation for Whole Foods Market, Inc. (WFM)

Jana said in its filing that it had started a review of strategic options for Whole Foods in light of the company's "apparent unwillingness to engage in discussions with third parties regarding such alternatives".

Whole Foods Market shares on Monday surged the most in more than two years after activist investor Jana Partners acquired a stake and suggested that the organic food grocer consider putting itself up for sale.

"Bittman can provide tremendous leadership in understanding how to appeal to Whole Foods' core customer", said Asit Sharma, an analyst at Motley Fool.

Whole Foods Market Chief Executive Officer John Mackey was supposed to spend this week celebrating the release of his new book, a paean to vegan eating that debuted on Tuesday.

It then outlined seven topics in which it meant to have discussions with Whole Foods' management: Stock performance; board and senior management composition; real estate and capital allocation strategies; brand development including loyalty and analytics; in-store execution including labor scheduling and management, shrink, layout, private label, and in-store signage; procurement and distribution arrangements; and a strategic alternatives review, "particularly in light of [Whole Foods'] apparent unwillingness to engage in discussions with third parties regarding such alternatives". It also said the investor has "substantial experience analyzing and investing in the grocery sector and more broadly across the food and retail sectors". In a regulatory filing Monday, the company said it thinks Whole Foods "shares are undervalued and represent an attractive investment opportunity".

The supermarket chain, which helped pioneer the organic-food movement, has been grappling with its worst sales slump in more than a decade.

Whole Foods did not provide immediate comment.

The Austin, Texas-based retailer, beleaguered by heightened competition and six quarters of same-store sales declines, recently cut its full-year sales and profit forecast and revealed plans to close 9 of its 469 stores this quarter.

Stock is now moving with a positive distance from the 200 day simple moving average of approximately 13.63%, and has a solid year to date (YTD) performance of 12.11% which means the stock is constantly adding to its value from the previous fiscal year end price. Deutsche Bank AG reissued a "hold" rating and set a $28.00 price objective (down from $29.00) on shares of Whole Foods Market in a research report on Thursday, February 9th.

In announcing its investment, Jana vowed to address the weak performance and potentially shake up the board.

What does the stake mean for Whole Foods?

  • Anthony Vega