Will Whole Foods Earnings Prove Downgrade Wrong? (WFMI)

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On Tuesday we’ll get to see earnings out of Whole Foods Market Inc. (NASDAQ: WFMI). The estimates from First Call are $0.36 EPS on $2.42 billion in revenues.  Next quarter estimates are $0.34 EPS on $1.91 billion in revenues. Estimates for fiscal September 2008 are $1.82 EPS on $9.71 billion in revenues.

Analysts have an average price target north of $46.00.  Options were of little use in predicting what sort of move was coming because of Friday’s expiration and because of a sharp share price decline.  Shares did recently bounce off of a $35+ level, which was essentially the same level they bounced of last summer.  The stock is right around critical long term levels because the 50-day moving average is $39.46 and the 200-day moving average is $41.88.  That 200 day moving average was a sharp resistance level earlier this week and it acted as resistance back in December as well. 

Whole Foods saw its stock get shelled by some 4% to $39.12 on double volume after Lehman cut its rating to Underweight on Friday ahead of numbers.  Whole Foods Market Inc.’s 52-week trading range is $34.14 to $53.65.

Jon C. Ogg
February 16, 2008