SFM Nasdaq Russell 1000 Earnings call
Sprouts Farmers Market (SFM) · Q2 2026 results and valuation
Share price: $50.56 · 2026-11-11
Results Q2 2026 vs Q1 2026 · previous quarter · published 29 Jul 2026 and 29 Apr 2026
Net income down 21.1% on the previous quarter. Management sounded restrained, in its script and in answers to analysts.
Only a basic analysis is available for this company at the moment.
1 · Numbers
−21.1%
Net income vs Q1 2026
Outlook given
Net income 129.2M vs 163.7M
Revenue −0.1%
Against the same quarter last year (Q2 2025) it is −3.4% — part of the move on last quarter is seasonal.
2 · How management spoke
Restrained
Less upbeat than 73% of company calls
Answers to analysts: cautious, in line with the script.
Similar to last call.
3 · What stood out
Guidance
SFM updated third-quarter guidance to expect comp sales between negative 0.5% and positive 1.5% and diluted earnings per share between $1.20 and…
Valuation
Is Sprouts Farmers Market undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2025-12-28), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 11.2% growth a year (3-year revenue growth), the model's fair value is $127.14 a share — the stock trades 60% below it. Today's price assumes −1.1% growth a year.
Current price
$50.56
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
-1.1% for 10 yrs
Fair value / share
$127.14
Buy below
$95.36
Price vs fair value
Undervalued 60%
Price vs buy-below price
Undervalued 47%
Read between the lines
-
Figure
Total sales rose 5% to $2.3 billion even though existing store sales fell 1%, with trends improving through May.
Source quote
“This growth was driven by strong new store performance, partially offset by a 1% decline in comparable store sales. Total sales were $2.3 billion, up $105 million or 5% compared to the same period last year. We saw sequential comp improvement through May.”
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Guidance
SFM expects its corporate tax rate to be approximately 25.5% and capital expenditures net of landlord reimbursements to be approximately $310 million.
Source quote
“We expect our corporate tax rate to be approximately 25.5%, and we expect capital expenditures net of landlord reimbursements to be approximately $310 million.”
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Fading
Investment will likely be below the historical 4% level unless a high-return opportunity justifies investing a little more.
Source quote
“So that will be the other factor in that, but certainly should be less than the 4% we've talked about historically... If we find a reason in a high-return opportunity, we'll invest a little more.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q2 2026. Ring: Q1 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“So slightly negative gross margins, slightly negative SG&A, a little bit of pressure in D&A, and then the new stores piece really kind of folds into that SG&A pressure.”
“Forging and innovation remain key strengths, and they continue to outperform overall company growth.”
“Against an uneven near-term backdrop, we remain focused on the areas we can control, sharpening value, strengthening forging, improving how we engage with customers and providing them a great in-store...”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-06-28)
| Metric | Q2 2026period end 2026-06-28 | Q1 2026period end 2026-03-29 | Change | Q2 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 2.33B | 2.33B | −0.1% | 2.22B | +4.7% |
| Gross profit | 900.6M | 917.3M | −1.8% | 862.6M | +4.4% |
| Operating income | 174.2M | 215.3M | −19.1% | 179.4M | −2.9% |
| Net income | 129.2M | 163.7M | −21.1% | 133.7M | −3.4% |
| EPS | 1.37 | 1.71 | −19.9% | 1.35 | +1.5% |
| P/E today 12.4 | 15.7 | 14.9 | +0.8 | 33.4 | −17.7 |
Topics
Most discussed now
- June, as expected, Sprouts Farmers Market had its lowest comp of the quarter as it lapped strong last year produce performance and...
- In the second quarter, its results played out in line with its outlook as Sprouts Farmers Market continues to lap outsized growth...
- Sprouts Farmers Market is seeing some good progress on units in the tests that it is doing, as it alluded to earlier, it would like...
- It's been really the last 2 weeks where Sprouts Farmers Market has seen a bit of impact on the business.
- Specifics in terms of price gap, Sprouts Farmers Market talked fairly consistently, Rupesh, about that in terms of the important pricing…
Faded since Q1 2026
- Fading EBIT margin pressure is expected to be approximately 75 basis points due to fixed cost deleverage from lower comp sales,...
- Fading This primarily reflects loyalty investment consistent with Sprouts Farmers Market's plan and unfavorable shrink performance.
- Fading Sprouts Farmers Market's first quarter gross margin was 39.4%, a decrease of 20 basis points compared to the same period last year.
- Fading Those are the things that Sprouts Farmers Market has been working on that it can continue to get a little bit better at...
Latest announcements
Official filings, newest first.
- Director or officer change · SEC 8-K
- Results of operations; Regulation FD disclosure · SEC 8-K
- Shareholder vote results · SEC 8-K
- Director or officer change · SEC 8-K
- Results of operations; Regulation FD disclosure · SEC 8-K
- Director or officer change · SEC 8-K
- Results of operations; Regulation FD disclosure · SEC 8-K
- Results of operations; Regulation FD disclosure · SEC 8-K