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Let Whole Foods Shares Fall Before Buying In |
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| May 15, 2008 04:48 PM UTC |
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Tracked Blogger
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5/14 - "It's been a rough go for WFMI this past year, shares are down 25% and YOY sales (growth) at their stores fell to 6.7% from 12% two years ago. Add to it the increasing cost of groceries and it equals a lower stock price for Whole Foods. The U.S. Labor Department reported this morning that the cost of a bag of groceries jumped 1.5% last month, its steepest one-month rise in 18 years...How do you think this will impact Whole Foods? Badly. To make matters worse, Whole Foods has 89 new stores under development. And most of them will be larger than its 270 existing stores. Starbucks (SBUX) anyone?" "Masters, let the stock continue to take a beating, when we get to $25, then buy." 
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2 Related Views
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 63% risk: moderate |
Bearish Hedged Play on Whole Foods Looks Good After Earnings
5/14 - "For a bearish hedged play on this stock, I would consider an August bear-call credit spread above the $37 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 7.1% return in three months as long as WF...
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47% risk: moderate |
Whole Foods = Starbucks
5/14 - "Whole Foods (WFMI) released results and profit fell 13%, again proving like Starbucks' (SBUX) results, consumers will go for the less expensive option for like items...While the company backed its same store sales number of 7.5% to 9.5%, given results to date, one has to think that will turn out to be just way too optimistic.
Like Starbucks, Whole Foods is being hit by a slowing econ...
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